DMAP
Elections, Philippines Inc.
At the DMAP General Membership Meeting
on November 17, DMAP members exercised their voting
rights on two occasions: ¥ A change in the By-Laws
that would allow representatives from service providers
to be eligible to become officers ¥ Election of
the 2006 Board of Directors From the time service providers
were allowed to become members in year 2000, and up
to the last GMM, representatives from service providers
had not been allowed to become officers. At the November
GMM, members voted by a wide margin, to allow service
provider reps to become officers. At the election of
Directors, the following were elected. Three of them
are current and past DMAP Presidents. ¥ John Guillermo
(CDO) ¥ Cora Curay (XVC) ¥ Jun Gabrino (Splash)
¥ Ana Rose Ochoa (J&J) ¥ Ninoy Rollan (TNT)
¥ Gerry Ong (Cheng Ban Yek) ¥ Pio Bernardo (Megavia)
¥ Oliver Caday (Nestle) ¥ Joseph Luat (Loscam)
¥ Danny Cabrera (Zuellig) After the GMM, in the
election of officers, the charter change voted earlier
was immediately applied, and allowed a service provider
rep to become an officer. Cora Curay, a multiple time
past President, was elected President. The rest of the
lineup of officers may still change because of a job
change in Splash for VP elect Jun Gabrino. The complete
slate will be announced at the Christmas fellowship
on Dec. 2. DMAP reps will take a brief respite from
their problems for a Wild Wild West celebration. Among
the problems occupying DMAP are the 38% increase being
sought by INHTA truckers, the 15% cargo handling rate
increase, and the bunker surcharge, not to mention the
continued high fuel prices, the increase in other cost
factors, and target shortfalls for many companies. Good
luck to all. While cleaning up my old files, and trying
to catch up with filing, I came across an interesting
whole-page advertisement dating back to July 1999. This
was during the time of the infamous EO 59 of Erap, and
more than six months before Erap's downfall. The ad,
placed in the July 28, 1999 issue of BusinessWorld,
was published by the so-called Philippines, Inc. Today,
six years later, it is interesting to look back, read
the "chilling" quote from Abraham Lincoln
that they cited, and read the names of the people behind
Philippines, Inc., so much in support of Erap. One can
reflect now on how quickly these people moved over to
the GMA side, some of them even joining Gloria's cabinet.
A statement citing Abraham Lincoln's quote as 'most
appropriate' to Erap's situation, and coming from the
persons listed, I described as "chilling",
for lack of a better term at the moment. I quote the
full page ad and the names of the officers and other
people behind Philippines, Inc. "If I were to read,
much less answer, all the attacks made on me, this shop
might as well be closed for any other business, I do
the very best I know, the very best I can, and I mean
to keep doing so until the end. If the end brings me
out alright, what's said against me won't amount anything.
If the end brings me out wrong, ten angels swearing
I was right would make no difference." - Abraham
Lincoln 'MR. PRESIDENT, THE ABOVE QUOTATION IS MOST
APPROPRIATE. WE KNOW YOUR INTENTIONS ARE GOOD AND YOU
ARE WORKING VERY HARD. CONTINUE WITH YOUR GOOD WORK.
WE ARE BEHIND YOU ALL THE WAY. PHILIPPINES, INC. I'd
like to print here the names of the people behind Philippines,
Inc. JOSE T. PARDO Honorary Co-Chairman RAFAEL B. BUENAVENTURA
Honorary Co-Chairman OFFICERS SERGIO ORTIZ-LUIS Chairman
JESUS M. PINEDA, JR. Vice-Chairman ANTONIO A. LOPA President
EUSEBIO H. TANCO Executive Vice President FERNANDO ZOBEL
DE AYALA VP- External Affairs RAMON S. ANG VP- Internal
Affairs ANNIE C. TAN-YEE Corporate Secretary & Treasurer
ATTY. L. T. SIGUION-REYNA Legal Counsel CESAR V. PURISIMA
Audditor ARSENIO M. BARTOLOME III ATTY. EMILIANO P.
JURADO EUSEBIO H. TANCO Chairman ALBERTO P. FENIX, JR.
RAMON S. ANG DANTE Y. GO ANTONIO O. COJUANGCO SAMSON
C. LIM RAUL T. CONCEPCION ANTONIO A. LOPA FELIMON R.
CUEVAS MANUEL M. LOPEZ WILLIAM T. GATCHALIAN SERGIO
ORTIZ-LUIS, JR. FERNANDO P. JACINTO PLACIDO L. MAPA,
JR. DANIEL Y. LAOGAN MANUEL V. PANGILINAN LUIS P. LORENZO,
JR. JESUS M. PINEDA, JR. ENRIQUE K. RAZON ANNIE C. TAN-YEE
LEONARDY T. SIGUION-REYNA JIMMY T. TANG LUCIO C. TAN
MIGUEL V. VARELA CESAR A. VIRATA FERNANDO ZOBEL DE AYALA
PETER C. L. YU VICENTE O. YU Address inquiries and comments
to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689,
or email dmap@i-manila.com.ph. Those interested in DMAP
training and other activities are requested to send
their e-mail addresses.
back to
top
Year-end
Woes
CARGO owners are now grappling with
the recently ordered 15% cargo handling rate increase,
announced by PPA GM Oscar Sevilla, said to be for the
North Harbor cargo handlers. This increase was supposed
to be for cargo handlers outside of the Noth Harbor,
but the news announcements seem to say the reverse.
This increase has been announced despite the non-completion
of the North Harbor hearing. The hearing had been discontinued
because the proponents' petition and FS did not satisfy
format and audit requirements. The last hearing was
even attended by Cong. Ed Zialcita of Para–aque.
Another strange thing is that it is the PPA, GM Sevilla
himself, which is defending and explaining the increase.
"There has been a tremendous increase in salaries
and wages as well as fuel and power. The increase in
cargo handling rates is (designed) to recover expenses
related to those", GM Sevilla was quoted by PortCalls
last Nov. 2. The Inquirer also quoted him last Nov.
8. Maybe this is not so strange at all. The PPA gets
10% of all cargo handling collections. This, together
with the earlier increase given to ATI and ICTSI, will
help ensure PPA's handsome net income and a high ranking
among the top 1,000 corporations. This anomalous situation,
the PPA conflict of interest, continues to be tolerated
by the government, all the way up to President Gloria.
The PPA reports to the DOTC and the DOTC to the President.
Madame President, why don't you stop this? Even if they
say it is legal, you can order them not to take the
10%. On the sea freight portion, the shipping lines
are implementing a new invention called bunker surcharge,
now that the AFRA is no longer valid under RA 9295.
With e-vat implementation this month, the shipping lines
are now talking about "enforcing 10% vat for fare
and 10% for fuel surcharge." The MARINA is allowing
this inflationary action by the shipping lines. MARINA
has so far not answered DMAP's two letters. The DOTC
is also tolerating this, and also the President. Something
else that most people don't know - the MARINA Administrator
sits in the Board of PPA and the PPA GM sits in the
Board of MARINA. Therefore all the talk by President
Gloria about reducing transport cost is all baloney.
DMAP has also just received a copy of a letter from
the North Harbor truckers (INHTA) asking the shipping
lines to grant them a 38% increase. With all these rates
going up, where are shippers to go? Gloria has been
claiming reduced transport costs in some news releases
and fooling the people of Mindanao. At the NLEX and
SLEX, the 10% vat supposed to be added to the toll fees
has not been implemented. At DMAP's last general membership
meeting for 2005, on November 17, members will be electing
next year's Directors and Committee Chairs, but prior
to that they will vote on a small charter change. The
proposed change will allow service provider reps to
be elected not only as Directors, but also as Officers.
If the proposal passes, the provision will apply immediately
the election of Directors, followed by the election
of Officers. DMAP has chosen a theme of 'Wild Wild West
Christmas Celebration'. The fellowship will be held
on December 2. Address inquiries and comments to Ed
Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689,
or email dmap@i-manila.com.ph. Those interested in DMAP
training and other activities are requested to send
their e-mail addresses.
Transport
Matters Sea Transport At the Agrilink/Foodlink 2005
conference less than two weeks ago
Transport Matters Sea Transport At
the Agrilink/Foodlink 2005 conference less than two
weeks ago, Cora Curay and I spoke in one of the seminars.
Our topic, a long-time concern of DMAP, was 'Why Shipping
Costs Are High'. The idea for this topic came from the
time-honored statement that it is more expensive to
ship corn from GenSan to Manila than from GenSan to
Hongkong. This statement is more than 15 years old,
yet it remains true to this day. Cora talked about Freight
Rate Setting Policies, and I talked about Additional
Reasons Why Shipping Costs Are High. I only wish to
reprint here my last slide, which is about rate increases
in the last six years. I called it the "Double
Your Money Game". Actually sea freight rates more
than doubled in the last six years. October 1999 +10.88%
November 2000 +20% November 2002 + 6% March 2003 + 5.98%
AFRA October 2003 + 7.5% November 2004 + 9% January
2005 + 5.5% May 2005 + 6.99% AFRA October 2005 +10%?
Bunker Surcharge Combined Increase in 6 Years +118%
I am not quite sure about the Bunker Surcharge % increase;
I put in 10% DMAP has now written MARINA Administrator
Vic Suazo twice on the two-tiered increase in 2004-2005
and the 6.99% AFRA. So far no reply has been received.
DMAP's query on the AFRA is why there is an AFRA based
on MC67 regulation during a deregulated environment.
In its second letter, DMAP also questioned the Bunker
Surcharge, why the shipping lines are trying to implement
a fuel adjustment when MC 67 is no longer in effect.
Also why the shipping lines are trying to implement
it as a cartel when we are deregulated and market forces
are supposed to prevail. On cargo handling, the North
Harbor hearing is at a standstill right now as far as
we know. We are not quite sure about the other ports,
said to be subject to a 15% increase, as announced by
PPA GM Oscar Sevilla last month. Air Transport Earlier
this year DMAP conducted a survey among its members
on the use of air transport. Air Transport Committee
Co-Chairperson Joey Castro from Accord Logistics presented
the survey results during a general membership meeting.
The survey showed very few users of air transport. Although
the membership population was over 90 companies, the
response rate was low. Highlights of his presentation
included the following: ¥ Survey Results o Volume
of airfreight users among the respondents totaled only
19 tons a month o Around 28% of the respondents have
at least 1 ton a month volume; the rest have negligible
volume o Cargo consisted mostly of perishable food and
equipment spares/consumables o Carriers used are PAL,
Cebu Pacific and Aboitiz 2GO ¥ Issues o Service
Reliability. Some cargoes are unexpectedly bumped off
at some ports o Service Reliability. No insulated containers
for frozen or chilled cargo o Customer Service. No timely
feedback on delayed flights / deliveries o Rates. Very
expensive o Network Coverage. Not enough flights, or
no flights, to some destinations Among the moves being
considered is to invite representatives from the carriers
-PAL, Cebu Pacific and 2GO. Land Transport We are still
trying to get used to the huge toll free increases earlier
this year. Truckers are now asking for increases because
of the rise in fuel prices. Also on land transport,
we note that the scheduled start of the Alabang viaduct
repair has not started as "promised" by the
PNCC at the meeting with the PNP a few months ago. Address
inquiries and comments to Ed Sanchez at tel. 671-8670,
fax 671-4793, cell 0918-914-1689, or email dmap@i-manila.com.ph.
Those interested in DMAP training and other activities
are requested to send their e-mail addresses.
back to
top
Logistics
Cost Performance
THE rise in importance of logistics
in business has highlighted the need for keeping track
of how well we do logistics in our companies. Measuring
how well we do logistics first requires that we examine
the objective of logistics. Per the CLM definition,
Logistics is that part of the supply chain process that
plans, implements and controls the efficient, effective
flow and storage of goods, services and related info
from the point of origin to the point of consumption
in order to meet customers' requirements. The objective
is therefore to satisfy customers' requirements. Typically,
and historically, customer's requirements have been
expressed as fast delivery of orders and complete delivery
of orders. Therefore the typical measures used have
been. The order delivery cycle - the time it takes from
the time of customer's order to the time of receipt
by the customer ¥ Order fill rate - the percentage
of customer orders that are delivered complete.
Line fill rate - the percentage of
lines ordered by the customers that are delivered complete
The first is a measure of responsiveness (time) while
the next two are measures of reliability. More recently,
order fill rate and line fill rate are being replaced
by Perfect Order Fulfillment Rate - the percentage of
orders delivered per schedule, complete, in good product
condition, and with no errors in documentation. It is,
of course, incomplete to just look at these measures.
One may achieve very fast deliveries and high fill rates,
but these might be achieved at very high cost and high
usage of resources. Hence it is also necessary to look
at cost, inventory levels, and use of other resources.
In the US, distribution measures have been monitored
for many years, particularly cost. For comparability
across companies and industries, cost has been monitored
as a percentage of sales. The earliest estimates of
distribution cost were in the 1960s.
In 1962, Peter Drucker suggested that
companies direct their attention to costs incurred after
the manufacturing was completed. A 1962 survey put distribution
cost at 10% of sales. By 1971, costs had declined to
just over 5% of sales revenue. This was a tremendous
improvement, following corporate reorganizations, which
allowed companies to focus on distribution cost. Moves
included the removal of warehousing from manufacturing,
transportation from purchasing, inventory management
and order entry from finance and sales, etc. In the
early 1970s, the oil crisis pushed back distribution
cost to the 9% level and up to 10% by 1980. In the 1980s,
cost declined to the 7% level, only to move up again
in the early 1990s. In the last 10 years, distribution
cost in the US has been relatively stable at the 8 to
9% level. Likewise, order delivery cycle performance
and fill rates have also been flat. INSERT TABLE HERE
PLS On first look, the order delivery cycle figures
of 8 to 9 days appear slow; however, one must appreciate
that these are average figures for the US, including
the large continental land mass.
However, even our data source Herbert
Davis says that 8 working days is too long, and 94%
line fill rate is unsatisfactory for many customers.
He also says that requirements of 5 days and fill rates
of not lower than 98% are now standard for many distribution
channels. Thus it can be said that the best efforts
of logisticians have not made much improvement in the
last ten years. Here in the Philippines, it is sad to
note that we do not have available data on cost and
service as in the US. Something sorely needed, as costs
rise and technology is brought in to stem the rise in
costs. Speaking of rising costs, local logisticians
are again faced with cost increases from all directions.
As we try to get used to huge toll free increases this
year, the 6.99% AFRA for shipping rates hit us last
May, an application of an MC from the regulated era
in a so-called deregulated regime. The MARINA has not
even answered our query about this out-of-place AFRA,
and we get hit with another bolt, a BSC (Bunker Sur
Charge).
I wonder why it was abbreviated to
BSC. As surcharge is one word, the appropriate abbreviation
is BS. As we try to fight the cargo handling increase
at North Harbor, the PPA proudly announced that it has
approved a 15% cargo handling rate increase in domestic
ports (except North Harbor). Obviously truckers are
also asking for rate increases, because of the continuing
rise in fuel prices. All the talk about bringing down
the cost of transport in the Philippines is just a lot
of hogwash, coming all the way from the President to
all the transport executives in the executive branch.
We started this column talking about watching costs.
Help! Address inquiries and comments to Ed Sanchez at
tel. 671-8670, fax 671-4793, cell 0918-914-1689, or
email dmap@i-manila.com.ph. Those interested in DMAP
training and other activities are requested to send
their e-mail addresses.
| |
Cost
% of sales
|
Order
Delivery Cycle, Days
|
Order
Fill RAte %
|
Line
Fill Rate %
|
1995 |
7.94
|
6 |
87 |
92 |
1996 |
8.01
|
9 |
87 |
94 |
1997 |
9.02
|
8 |
87 |
94 |
1998 |
8.95
|
7 |
85 |
93 |
1999 |
7.34
|
8 |
85 |
90 |
2000 |
9.44
|
8 |
86 |
92 |
2001 |
9.17
|
7 |
87 |
92 |
2002 |
7.65
|
8 |
88 |
95 |
2003 |
7.52
|
7 |
85 |
91 |
2004 |
8.37
|
8 |
91 |
94 |
back to
top
News
from the Academe
TIP Last week I gave a talk at the
Technological Institute of the Philippines (TIP) on
DMAP and Logistics. When the student group TIP-JLOP
(Junior Logistics Organization of the Philippines) invited
me, I automatically expected that they would be from
the Industrial Engineering school, or the Business school;
however I was surprised to learn that the Logistics
Management Major is in the BS Commerce curriculum. It
was refreshing to see so many young people in an institution
of learning. More refreshing, especially since the students
are students of logistics management.
What struck me even more was the enthusiasm of these
students in 'LM' (for Logistics Management), now a part
of their lingo. I gathered that many activities had
been lined up for the semester, including more seminars
and symposia, and a field trip to a logistics service
provider (Omni Logistics). The student group, JLOP,
looks well-organized, led by its energetic student President
Melvin Duenas. I couldn't count the number of attendees
at my talk. I am sure there were more than 100. There
might have been 150, or even more.
How has this enthusiasm in logistics been built up at
TIP? It can be attributed, as far as I can tell, to
the efforts of Charlie Villasenor, formerly from Caltex,
formerly President of PMMAP (now PISM), and now President
& CEO of Transprocure. I do not know exactly what
his role is at TIP, besides being adviser/consultant.
Charlie was once a speaker at DMAP's annual logistics
conference. After my talk at TIP, they showed a video
clip with Charlie explaining the looming large demand
for logistics professionals in the country. The clip
also showed Transprocure VP Dino Limjap.
I was also pleasantly surprised to learn that some friends
are also involved in TIP. Rullen Liwanag of AFC Logistics
(a DMAP member) is an instructor in logistics and would
have awarded the certificate of appreciation to me,
but he could not make it. I also saw the name of Julius
Bambico as an adviser of JLOP. Julius was formerly with
Omni Logistics (which is now a DMAP member), later with
AFC Logistics, and now VP-CEO and owner of Log Consult
Corp. Julius teaches at TIP. Lastly, TIP Vice President
for Academic Affairs Ging Flora is a long-time friend
from Mapua.
DLSU
At DMAP's Logistics Conference last week, former DMAP
President Ike Castillo gave an update on the DMAP-DLSU
Supply Chain Management Program. In a couple of months
the program will turn out its first batch of 'graduates',
those who will have completed all seven modules.
UPLB. Lastly, we have had brief communications with
UP Los Ba–os. Prof. Ari Halos of the School of
Industrial Engineering asked us a few questions earlier
this year on the SCOR Model of the Supply Chain Council.
My long-delayed reply to him later led to a suggestion
for him to give a talk at Agrilink/Foodlink 2005, wherein
DMAP is a co-organizer. This year's theme is "Efficient
Supply Chain: Key to Competitiveness".
Agrilink approved Prof. Halos's proposed talk, which
is entitled "Understanding Supply Chains with the
Supply Chain Operations Reference". Agrilink also
approved another talk to be given by DMAP, entitled
"Other Reasons Why Shipping Costs Are High".
This talk will be given by a DMAP representative. Address
inquiries and comments to Ed Sanchez at tel. 671-8670,
fax 671-4793, cell 0918-914-1689, or email dmap@i-manila.com.ph.
Those interested in DMAP training and other activities
are requested to send their e-mail addresses.
Strange
MOA North Harbor PPA Hearing
The second hearing on the 25.7% increase
in arrastre and stevedoring rates being petitioned by
the North Harbor cargo handlers was held on Sept. 1.
No less than Cong. Ed Zialcita of Para–aque attended
to express his opposition to rate increases which ultimately
get passed on to the consumers. The hearing did not
last long because the petitioners were not prepared
to make their presentation justifying the increase.
Tet Gambito, representing DMAP, questioned the ANCHOR
presentor. Hearing officer Atty. Ba–as ordered
another hearing to be scheduled. MOA A draft MOA is
being circulated apparently for comments.
The draft MOA is among 15 parties,
7 government agencies and 8 private groups, and is supposedly
pushing for the reduction of inter-island transportation
cost of agricultural products through RORO transport.
The parties included are : DOTC, DTI, DA, NEDA, PPA,
CPA, MARINA, PNCC, CCAP (Cold Chain Association), DMAP,
PISA, APPOOP, PCASO, COLTOP, CTAP. The curious thing
is that DMAP is one of the parties included in the MOA,
yet DMAP was not officially furnished a copy and not
asked for comments. As far as we can determine, the
MOA was drafted by PPA and is being pushed by them.
I wonder how they will get us to sign
the MOA without giving us a copy. Maybe they think that
DMAP is a "second class" party and does not have to
be asked. We will wait. Meanwhile, we wonder why they
mention the implementation of "preferential cargo handling
tariff rates prescribed by PPA" for agricultural products.
There is no cargo handling for true RORO transport,
which I prefer to call DODO, for "Drive On Drive Off".
This literally describes how it is done, and makes it
obvious that there is no cargo handling. It appears
that PPA is trying hard to set fees where there should
be none.
Is this an agency that is trying to
reduce cost of transport? DMAP Conference The annual
Logistics Conference is on for Sept. 15-16 at the EDSA
Shangri-La Hotel, with the theme "Seamless Supply Chain
in an Archipelagic Environment: A Continuing Challenge".
Participant fees are: Participant from DMAP member company,
P8,690 Non-member, P10,865 The fee covers lunches and
meriendas for two days, conference binder, giveaways
and certificate of completion. There will also be raffle
prizes during the conference and cocktails at the end
of the conference. The lineup of speakers has been finalized.
Key Note Speakers are: From the Government:
DTI Sec. Peter B. Favila From the Private Sector: Dr.
Rolando V. Hortaleza - CEO Splash Corp. Speakers in
the technical sessions are the following: Henry Basilio,
UA&P, Director Transport & Logistics Center
Logistics Infrastructure Support & Efficiency ¥
Road Network - public investments in road construction
and maintenance, impact of poor roads on transport cost,
gaps in road investment requirements, recommended policy
action/s. ¥ Cold Storage Facilities - existing capacity
of the cold storage facilities in the country, regional
distribution of cold storage facilities, NDC-PIC cold
storage projects.
¥ Ports and Shipping - flaws in
the regulatory framework, cargo handling rate increases,
proposed amendments to the RORO Policy (EO 170-B) Antonio
Domingo, BayanTrade, Dir. Strategic Sourcing & SCM
Extending the Enterprise Supply Chain & Supply Chain
Mgt. to Your Vendors as Business Partners ¥ Business
Realities ¥ SCM In A Business Enterprise System
¥ Critical Vendor Partnership Value-Added Areas
¥ Vendor Partnering Process ¥ Supply Chain Effectiveness
Robert Nacianceno, MMDA General Manager Update On MMDA
Projects Atty. Rene Ba–ez, PLDT, Chief Governance
Officer Corporate Governance Brett Marshall, Zuellig
Pharma Corp., VP-Distribution Meeting the Challenges
in Delivery Excellence for Healthcare Products ¥
The diverse nature of an archipelago provides plenty
of challenges to the supply chain, but the health &
welfare of the people depends heavily upon the timely,
efficient and quality-safe delivery of healthcare products.
¥ Review the supply chain strategies
employed by local and multinational healthcare companies
to balance global sourcing while most effectively ensuring
that their products have time, place and quality utility
throughout the islands of the Philippines. ¥ Overcoming
the challenges posed by geography, climate & infrastructure
availability, capacity & reliability. Laurence Go,
President, Auto ID Philippines, Inc. Improving Supply
Chain Efficiency Through Electronic Data Interchange
¥ What is EDI? Why email is not EDI?
EDI Messages & Benefits of EDI
¥ EDI Standards: External and Internal ¥ The
GS-1 EDI Standards for the Philippines - The importance
of the GS-1 EDI standards - Moving away from private
externals standards - Encouraging trading partners to
adhere to standards ¥ Value Added Network supporting
GS-1 Standards ¥ Case Study: EDI in action, Cost
of EDI, Getting started in EDI Roberto Cabaero, Julie's
Franchising Corp., Consultant Supply Chain Management:
A Franchisor's Core Competency ¥ Supply Chain Principles
¥ Expansion Through Collaboration ¥ Customer
Service from a Franchisees / Operator's Point of View
¥ Case Study: The Julie's Bakeshop Experience Martin
Cary Q. Tiglao, IBM Solutions Delivery, Business Solutions
Services Streamlining Manufacturing & Distribution
While Preparing For A More Complex Future ¥ RFID
Overview ¥ Meeting Changing Industry Dynamics Heads-on
¥ Achieving Manufacturing & Distribution Goals
with Technology.
¥ Leveraging RFID for success.
¥ Using RFID to Transform the Supply Chain. ¥
Optimizing Opportunities for Cost Savings & Process
improvements ¥ Extending Existing Technology with
RFID Robert Vallender, Nestle Philippines, Head of Supply
Chain Operations Complexity - Can We Manage It? ¥
The details will highlight the need to understand what
adds complexity and costs and how Supply Chain Professionals
can Streamline the entire process. In addition, Ayala
Systems is sponsoring lunch, with a technical presentation
by J. Ross Williams, GLOG Sales Director for Asia Pacific.
As usual, the exhibits are open to the public for free.
Over 35 exhibit booths are expected to be put up, all
of them focused on logistics and supply chain services.
DMAP's invitation to sponsors and advertisers
for this year's Annual Logistics Conference remains
open; however, the slots for principal sponsors have
all been taken. A small number of slots for regular
sponsors and break sponsors remain. Contributions for
exhibitors have been maintained at the same amounts
over the years at P60,000 for principal sponsors, P30,000
for regular sponsors (5 slots left), P150,000 for cocktails
sponsor (1 slot available), P100,000 for luncheon sponsor
(1 slot available), and P50,000 for break sponsor (4
slots available). Principal sponsors are: Ayala Systems
Technology Inc. (luncheon sponsor) Boeing Material Handling
IDS Logistics Edward Keller SSI Schaefer TNT Express
Maxima Equipment Exel Logistics Phil Forklift Center
inc. Smart Communications Loscam Phils. PLDT Address
inquiries and comments to Ed Sanchez at tel. 671-8670,
fax 671-4793, cell 0918-914-1689, or email dmap@i-manila.com.ph.
Those interested in DMAP training and other activities
are requested to send their e-mail addresses.
Highway and Other Robberies
Highway Robberies
At the PNP Headquarters last week, the PNP presented
hijacking figures at a meeting sponsored by the Japanese
Chamber of Commerce and Industry of the Philippines
(JCCIPI). Meeting participants included PNP officials,
JCCIPI officials, CTAP Chairman Col. Rudy de Ocampo,
PNCC spokesperson Engr. Sales, a representative of SEIPI
(Semiconductors and Electronics Industry in the Phils.)
and DMAP representatives, namely President Jun Gabrino,
Director and PRO John Guillermo and myself.
The meeting was presided over by PC
Supt. Juan Urani, Jr., Executive Officer of the Directorate
for Operations.
From my notes during the meeting, I
captured the following figures.
PLACE EXCEL TABLE HERE
Comments on these figures are:
¥ There was a marked decrease in the incidence of
hijacks this year
¥ There is a discrepancy of 1 in the 2005 number
of hijacks (I miscopied the figures)
¥ The rate of apprehension (called 'intercepted')
declined markedly from 29% (12 / 41) to 7% (1 / 15).
The rate of apprehension in Metro Manila last year and
this year was a sad zero.
¥ These are incidents reported to the PNP, therefore
incomplete.
The last comment makes one wonder -
what is the true magnitude of the hijacking problem?
When I asked Supt. Urani if he could venture a guess,
he was silent on this and, instead, remarked - just
like other crimes, many of them are unreported. However,
Col. De Ocampo of CTAP said as high as 50% of hijacks
may be unreported, meaning that the true incidence is
double the PNP figures.
We think that the high incidence in
Region 3 (Central Luzon) and 4A (Southern Luzon) is
due to the many possible escape routes in these areas,
and, perhaps more important, the presence of fences.
The PNP also released figures on 'robberies',
distinguished from hijacks in that the victims are bus
passengers. The PNP said the incidence in first half
2004 was 17, with 1 interception, while it was 19 in
2005, also with 1 interception.
The other significant agenda in last
week's meeting was a discussion by PNCC's Engr. Sales
about the reconstruction in Alabang. Highlights are
the following:
¥ Plans are not yet final
¥ Alabang bridge will be widened from 6 lanes to
8 lanes. The additional lanes will be on the west side
¥ The 27 km stretch of the expressway from Alabang
to Sta. Rosa will be widened from 4 lanes to 8 lanes
¥ The stretch from Sta. Rosa to Calamba will be
widened from 4 lanes to 6 lanes
¥ The connection from Calamba to Sto. Tomas will
be a new 4 lane highway
¥ The total schedule will be 18 months, but the
Alabang bridge only will be 12 months
¥ Construction will start in August or September
¥ First step is widening of the ground level under
the bridge.
¥ During construction, 4 lanes of the bridge will
always be open
¥ There will be no re-routing, except maybe class
1 vehicles
North Harbor PPA Hearing
After being done with the subject of highway robberies,
it seems logical to deal with another form of robbery.
The PPA has just called for a hearing on a petition
of the North Harbor cargo handlers called ANCHOR. The
hearing is set for July 29, 2005. ANCHOR has amended
its petition to +25.74%. The statements attached by
the PPA to the petition are not audited, without certification,
incomplete or not legible.
'Basic' Warehousing Seminar
This year's edition of this seminar will be on August
25 to 26 at the Astoria Plaza. As usual, the seminar
will include a visit to a live warehouse and a workshop.
Far from being just "basic",
seminar topics also include: Intro to SCM, logistics
and warehousing, update on bar coding, warehousing trends
and developments. The basic aspects covered are: nature
and characteristics of a warehouse, warehouse procedures,
GMP, safety, warehouse layout guidelines, performance
measures, and materials handling principles.
Target participants are warehousing
staff requiring basic training, trainees, new staff,
or older staff requiring a refresher. Also targeted
are non-warehousing staff in related and interface functions,
such as distribution, transport, shipping, inventory
management, purchasing, production, accounting, engineering,
QC, etc. Likewise, managers requiring a basic understanding
of warehousing and trends may attend the seminar.
Speakers will be Malou Santos, formerly
from J&J and now an independent consultant, Norman
Adriano from WG&A, Larry Go from Auto ID Phils.,
and myself.
Fees for the two-day seminar inclusive
of meriendas, lunches, seminar materials and the warehouse
visit are P9,800 for non-DMAP members and P7,840 for
DMAP members. Payment deadline is August 19.
DMAP Conference
DMAP's invitation to sponsors and advertisers for this
year's Annual Logistics Conference remains open. The
Logistics Conference is scheduled for Sept. 15-16 at
the EDSA Shangri-La Hotel. Contributions for exhibitors
have been maintained at the same amounts over the years
at P60,000 for principal sponsors (6 slots left), P30,000
for regular sponsors (10 slots left), P150,000 for cocktails
sponsor (1 slot available), P100,000 for luncheon sponsor
(1 slot available), and P50,000 for break sponsor (4
slots available).
This year's theme is "Seamless
Supply Chain in an Archipelagic Environment: A Continuing
Challenge".
Address inquiries and comments to Ed
Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689,
or email dmap@i-manila.com.ph. Those interested in DMAP
training and other activities are requested to send
their e-mail addresses.
January
to June
SCM Performance
SCM and Logistics
In recent years, the term Supply Chain Management has
become very popular in local business, now 'invading'
organization charts in names of units and positions,
sometimes replacing the term Logistics. Yet, probably,
usage of the term Supply Chain Management has gone ahead
of real understanding of the term.
In the way that Logistics is different
from Supply Chain, performance measurement in these
two areas are quite different. SCM performance is much
more complex.
First let us examine the definitions.
According to the CLM (Council of Logistics
Management, and now the Council of Supply Chain Management
Professionals), Logistics is:
"That part of the supply chain
process that plans, implements and controls the efficient,
effective flow and storage of goods, services and related
information from the point of origin to the point of
consumption in order to conform to customers' requirements."
Obviously, in order to measure Logistics
performance, we need to look at how well the objective
is achieved - how well are customers' requirements conformed
to?.
Of course, the attainment of customer
requirements cannot be looked at by itself, without
considering how much resources are used to achieve the
satisfaction of customers. To give a complete picture
of Logistics performance, we also need to measure the
effectiveness of goods flow and efficiency in terms
of cost and use of assets.
Let us now look at the definition of
Supply Chain Management. I like the definition proposed
by John Mentzer of the University of Tennessee, with
his colleagues, compared to the CSCMP definition; but
here they are both.
John Mentzer:.
"The systemic, strategic coordination of the traditional
business functions and the tactics across these business
functions within a particular company and across businesses
within the supply chain, for the purpose of improving
the long-term performance of the individual companies
and the supply chain as a whole"
CSCMP:
"Supply Chain Management encompasses the planning
and management of all activities involved in sourcing
and procurement, conversion, and all Logistics Management
activities.
Importantly, it also includes coordination
and collaboration with channel partners, which can be
suppliers, intermediaries, third-party service providers,
and customers.
In essence, Supply Chain Management
integrates supply and demand management within and across
companies."
Per John Mentzer, the objective is
to improve the long-term performance of the companies
in the supply chain and the supply chain as a whole.
For the company, this means measuring its long term
performance - growth, volume, profits, etc. Then the
same for the other companies in the supply chain. This
suggests that each company does its own measurement.
And then, finally, the supply chain as a whole. This
last item is as vague as can be.
The CSCMP definition and Mentzer's
definition suggest that measuring SC performance includes:
¥ Measuring logistics performance of the company
¥ Measuring how well the traditional business functions
are coordinated in the company
¥ Measuring how well the traditional business functions
are coordinated across businesses
¥ Measuring how well supply and demand management
are integrated
Thus, in comparison, Logistics performance
measurement looks relatively simple, involving the usual
categories of
¥ Cost, such as total cost as % of sales, functional
cost components
¥ Responsiveness (time), such as order delivery
cycle, customer complaint response time
¥ Reliability (customer satisfaction/service quality),
such as perfect order fulfillment, % complaints handled,
line fill rate, % on time deliveries, error rate
¥ Resources management/productivity, such as inventory
level, velocity, return on assets
When it comes to Supply Chain performance measurement,
apart from Logistics, the metrics are not standardized,
or even categorized in a neat way, and are just evolving
now.
We are beginning to encounter metrics such as the following:
¥ Total supply chain cost
¥ Supply chain response time
¥ Production flexibility
¥ Cash to cash cycle time
¥ Number of data sets shared
¥ Number of customer contact points
¥ Relative customer order response time
¥ Product finalization point
¥ Product category commitment ratio
Someday, supply chain performance measures
will get categorized into meaningful groups, and the
issue of measuring total supply chain performance will
become clearer, and better measures for degree of collaboration
and cooperation will emerge.
'Basic' Warehousing Seminar
This year's edition of this seminar has been postponed
to August 25 to 26, still at the Astoria Plaza. As usual,
the seminar will include a visit to a live warehouse
and a workshop.
Far from being just "basic",
seminar topics also include: Intro to SCM, logistics
and warehousing, update on bar coding, warehousing trends
and developments. The basic aspects covered are: nature
and characteristics of a warehouse, warehouse procedures,
GMP, safety, warehouse layout guidelines, performance
measures, and materials handling principles.
Target participants are warehousing staff requiring
basic training, trainees, new staff, or older staff
requiring a refresher. Also targeted are non-warehousing
staff in related and interface functions, such as distribution,
transport, shipping, inventory management, purchasing,
production, accounting, engineering, QC, etc. Likewise,
managers requiring a basic understanding of warehousing
and trends may attend the seminar.
Speakers will be Malou Santos, formerly
from J&J, now an independent consultant, Norman
Adriano, from WG&A, Larry Go, from Auto ID Phils.,
and myself.
Fees for the two-day seminar inclusive
of meriendas, lunches, seminar materials and the warehouse
visit are P9,800 for non-DMAP members and P7,840 for
DMAP members. Payment deadline is August 19.
DMAP-DLSU SCM Program
Meanwhile, at De La Salle University, the DMAP-DLSU
SCM Program continues, with Module 4 on Warehousing
and Module 2 on Transport (re-run) running at this time.
Both modules will be completed on July 16. Module 6
on Procurement is expected to start on July 23.
DMAP Conference
DMAP's invitation to sponsors and advertisers for this
year's Annual Logistics Conference remains open. The
Logistics Conference is scheduled for Sept. 15-16 at
the EDSA Shangri-La Hotel. Contributions for exhibitors
have been maintained at the same amounts over the years
at P60,000 for principal sponsors (7 slots left), P30,000
for regular sponsors (over 10 slots left), P150,000
for cocktails sponsor (1 slot available), P100,000 for
luncheon sponsor (2 slots available), and P50,000 for
break sponsor (4 slots available).
This year's theme is "Seamless
Supply Chain in an Archipelagic Envurinment: A Continuing
Challenge".
Address inquiries and comments to Ed
Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689,
or email dmap@i-manila.com.ph. Those interested in DMAP
training and other activities are requested to send
their e-mail addresses.
back to top
Logistics Software
The Council of Logistics Management
(CLM) published every year for 18 years, up to year
2000, a Logistics Software Directory. Then it stopped
when the annual publications appeared to be repetitions.
Since 2000, however, the landscape of the software industry
changed dramatically, and the CLM decided to compile
a new edition of the directory, with an objective of
focusing on functionality.
The 2003 Directory contained 200 vendors and over 325
packages. The packages were categorized into nine areas
of functionality, with each area identified by up to
a dozen functions. The categories are listed below,
with descriptions of contents.
• Warehouse Management. 96 vendors. Area includes
Planning and execution of physical receiving, storage,
picking, and shipping
• Transportation Management. 104 vendors. Area
includes management of freight manifesting, load planning
and optimization, freight payment, carrier management,
routing
• Inventory Planning / Management. 78 vendors.
Area includes net requirements, DRP, MRP, Master Production
Scheduling, vendor and/or customer inventory info sharing,
VMI, collaborative planning
• Advanced Planning. 94 vendors. Area includes
Available to Promise, supply chain visibility, supply
chain decision support, business planning and analysis
tools, supply chain strategy, simulation, and modeling.
• Order Processing. 75 vendors. Area includes
capture or entry of customer order info and data through
keystroke, voice, EDI, internet, or other means
• Customer Relationship Management. 34 vendors.
Area includes Sales Force Automation, field service,
call center management, broker / agent / distributor
interfaces, retail storefront and e-commerce, customer
self-service, marketing automation, content and business
rules management, customer and sales business intelligence.
• Forecasting. 42 vendors. Area includes future
demand forecast generation.
• Manufacturing. 38 vendors. Area includes production
planning, production scheduling, shop floor management,
manufacturing execution, and reporting.
• Procurement. 60 vendors. Area includes suppler
management, purchasing execution, contract management,
MRP, sourcing, marketplaces.
We note that Advanced Planning and
CRM are not traditional functions from ten years ago.
I must admit that I am not familiar with one or two
terms in the descriptions above.
The 2003 Directory also contains some
ancillary information about each software product:
• Vertical / Industry Focus
• Well-Known Users
• Technical Environments
• Pricing Models
• User Groups
• Implementation
Establish-Davis, the company selected
by CLM to compile the new directory, also reported some
interesting observations and comments.
• ‘Wish list’ top topics are RFID
and Internet connectivity / visibility. Also mentioned
are security and collaboration capabilities
• Software investment deciding factors. Number
one is money. Lack of resources is also a key obstacle.
Also mentioned is the company’s ability to change
business processes
• Implementation difficulties. Vendors mention
lack of user resources, inability to build consensus,
and lack of commitment to training. Users mention too
much training, and lack of strong and capable internal
project management.
• Software capabilities not used. Vendors cite
metrics and management reporting
• Implementation cost. Users believe that implementation
costs run higher than the ‘rules of thumb’
used by software vendors.
• Implementation time. Software vendors believe
that their software can be implemented in a few months,
while users feel it takes 6 to 24 months.
• Financial justification. Vendors’ ‘rules
of thumb’ are that payback is one year or less,
while most users expect payback of up to two years.
Basic Warehousing Seminar
This year’s edition of this seminar will be held
on July 14 to 15, at the Astoria Plaza. As usual, the
seminar will include a visit to a live warehouse and
a workshop. Seminar topics include: Intro to SCM, logistics
and warehousing, nature and characteristics of a warehouse,
warehouse procedures, GMP, safety, warehouse layout
guidelines, performance measures, materials handling
principles, basics of bar coding, warehousing trends
and developments.
Target participants are warehousing
staff requiring basic training, trainees, new staff,
or older staff requiring a refresher. Also targeted
are non-warehousing staff in related and interface functions,
such as distribution, transport, shipping, inventory
management, purchasing, production, accounting, engineering,
QC, etc. Likewise, managers requiring a basic understanding
of warehousing and trends may attend the seminar.
Speakers will be Malou Santos, formerly
from J&J, now an independent consultant, Norman
Adriano, from WG&A, Larry Go, from Auto ID Phils.,
and myself.
Fees for the two-day seminar inclusive
of meriendas, lunches, seminar materials and the warehouse
visit are P9,800 for non-DMAP members and P7,840 for
DMAP members. Payment deadline is July 8.
DMAP-DLSU SCM PROGRAM
Meanwhile, at De La Salle University, the DMAP-DLSU
SCM Program continues, with Module 4 on Warehousing
and Module 2 on Transport (re-run) running at this time.
Both modules started on June 4.
DMAP CONFERENCE
DMAP’s invitation to sponsors and advertisers
for this year’s Annual Logistics Conference remains
open. The Logistics Conference is scheduled for Sept.
15-16.
Address inquiries and comments to Ed Sanchez at tel.
671-8670, fax 671-4793, cell 0918-914-1689, or email
dmap@i-manila.com.ph. Those interested in DMAP training
and other activities are requested to send their e-mail
addresses.
back to top
Supply
Chain Management
TWO columns ago, we started to discuss
the move towards Supply Chain thinking from Logistics
thinking, not only here in the Philippines, but elsewhere.
We noted that the Council of Logistics Management (CLM)
changed its name last January to Council of Supply Chain
Management Professionals (CSCMP).
We devoted the last issue to sea transport matters and
we promised to return to the subject of Supply Chain
Management in a future issue. We now return to this
subject.
First of all, we note that "supply
chain" is different from "supply chain management".
On "supply chain" first, the literature gives
varying definitions, but they tend to agree with each
other.
Here are some definitions of "supply
chain":
¥ A set of firms that pass materials
forward (LaLonde and Masters)
¥ The alignment of firms that brings products or
services to market (Lambert, Stock, and Ellram)
¥ The network of organizations that are involved,
through upstream and downstream linkages, in the different
processes and activities that produce value in the form
of products and services delivered to the ultimate consumer
(Christopher)
¥ A set of three or more entities (organizations
or individuals) directly involved in the upstream and
downstream flows of products, services, finances and/or
information from a source to a customer (Mentzer and
others).
As to the classification of supply
chains, we have seen the following in the literature:
¥ Mentzer and others identify three
degrees of supply chain complexity, namely, a "direct
supply chain", an "extended supply chain",
and an "ultimate supply chain"
¥ Hughes, Ralf, and Michels have identified nine
models of supply chains
Mentzer and others explain further:
An "extended supply chain"
includes suppliers of the immediate supplier and customers
of the immediate customer.
An "ultimate supply chain"
includes all the organizations involved in all the upstream
and downstream flow of products, services, finances
and information from the ultimate supplier to the ultimate
customer. For example, a third party financial provider
may provide financing, bearing some of the risk and
giving financial advice. A TPL provider may perform
the logistics activities between two of the companies,
and a market research firm may provide info about the
ultimate customer to a company well back up the supply
chain.
Supply chains exist whether they are
managed or not. Mentzer therefore emphasizes that there
is "a definite distinction between supply chains
as phenomena that exist in business and the management
of these supply chains.
An organization can be part of numerous
supply chains, for example, a supermarket can be part
of the supply chain for canned food products, for toiletries,
for meats, and for many other products.
On "supply chain management", there is a
wide variety of definitions.
Some example definitions are:
¥ SCM traditionally requires separate
materials functions to report to an executive responsible
for coordinating the entire materials process, and also
requires joint relationships with suppliers across multiple
tiers. SCM is a concept, "whose primary objective
is to integrate and manage the sourcing, flow and control
of materials using a total systems perspective across
multiple functions and multiple tiers of suppliers"
(Monczka, Trent & Handfield)
¥ Supply chain strategy includes "...two or
more firms in a supply chain entering into a long term
agreement: É the development of trust and commitment
to the relationship; É the integration of logistics
activities involving the sharing of demand and sales
data; É the potential for a shift in the locus
of control of the logistics process." (LaLonde
and Masters)
¥ "SCM deals with the total flow of materials
from suppliersthrough end usersÉ" (Jones
and Riley)
¥ SCM is "É an integrative philosophy
to manage the total flow of a distribution channel from
supplier to the ultimate user." (Cooper et al)
Although there is a wide variety of definitions, Mentzer
classifies them into three kinds.
¥ A management philosophy
¥ Implementation of a management philosophy
¥ A set of management processes
Mentzer continues: As a management philosophy, SCM
has the following characteristics:
¥ A systems approach to viewing the SC as a whole
and to managing the flow of goods
¥ A strategic orientation toward cooperative efforts
to synchronize and converge intrafirm and interfirm
operational and strategic capabilities into a unified
whole
¥ A customer focus to create unique and individualized
sources of customer value, leading to customer satisfaction
As a set of management activities to implement a philosophy,
the following activities are mentioned:
¥ Integrated behavior
¥ Mutually sharing info
¥ Mutually sharing risks and rewards
¥ Cooperation
¥ The same goal and same focus onserving customers
¥ Integration of processes
¥ Partners to build and maintain long term relationships
As a set of management processes, Lambert, Stock, and
Ellram suggest the following key processes: customer
relationship management, customer service management,
customer service management, demand management, order
fulfillment, manufacturing flow management, procurement,
and product development and commercialization.
We will continue in the next issue.
Address inquiries and comments to Ed
Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689,
or email dmap@i-manila.com.ph. Those interested in DMAP
training and other activities are requested to send
their e-mail addresses.
No
Competition
THE joke of the day is something said
by a Dept. Secretary in a cabinet meeting. This is the
version of the story that we heard. A proposed EO allowing
the conversion of private non-commercial ports into
commercial ports was being discussed.
After the proponent said that the
EO would foster competition, the President said that
that was good. To which the secretary said, Ma'm, hindi
pwede sa amin 'yan; here in my department, we have no
competition. Talking about the President, she is expected
to be the keynote speaker at the Western Mindanao Roro
Shipping Conference slated on April 27 in Zamboanga
City.
DMAP is also invited to provide a speaker
on 'Success Stories in RORO Shipping'. Most likely it
will be DMAP past President Cora Curay who would go
there. Key government transport officials are also expected,
including DOTC Sec. Leandro Mendoza, MARINA Administrator
Vic Suazo, PSB Executive Director Pete Mendoza and PPA
GM Oscar Sevilla.
The Zamboanga conference will nearly
coincide with the 3rd Philippine Shipping and Ports
Conference, to be held at the Manila Peninsula on April
28-29. We also heard that the Oversight Committee held
a hearing about Cong. Ed Zialcita's speech "Where
there's smoke, there's fire". This concerns the
stance of the PPA with respect to ATI, ICTSI and Harbour
Centre.
A second hearing is to be held next
Wednesday. Meanwhile, dismissed PPA official Leopoldo
Bungubung is still sitting in his office. In domestic
shipping, everything is quiet at this time about shipping
rates. At the MARINA, Ric Romero has now been designated
Deputy Administrator for Operations. Forum on Measuring
Supply Chain Performance Last chance to join this half-day
forum on April 22 at the Astoria Plaza.
It features a panel of speakers who will share their
wide experience on:
What measures are important?
* Overall logistics and supply chain measures
* Warehousing, transportation, inventory management,
customer service, etc.
* How do you measure service providers
What do top Philippine companies do? The panel of
speakers includes:
* Ike Castillo (James Hardie, formerly
Zuellig Pharma, Nestle)
* Cora Curay (XVC Logistics, formerly Coca-Cola)
* Jun Gabrino (Splash)
* Boy Arceo (Smart)
I will do the intro and summary. Next in the lineup
of DMAP training activities is the Shipping Immersion
Course, scheduled for May 6 to 8. It is a seminar on
board the Mary Queen of Peace, a Negros Navigation vessel,
while en route to Boracay.
Speakers will include maritime industry
experts, Ric Romero (designated MARINA Deputy Administrator),
Hector Miole (PPA), Atty. Pete Mendoza (PSB), Prof.
Henry Basilio (UA&P) and Cora Curay (DMAP).
Still on training, the DMAP-DLSU program
on Logistics Management is ongoing at the DLSU Greenhills
campus. Ongoing are Modules 1 (Evolution of SCM) and
3 (Inventory Management).
DMAP's contest for this year's conference
theme was selected at DMAP's last Board meeting on April
5. The winning theme is "Seamless Supply Chain
in an Archipelagic Environment: A Continuing Challenge".
back to top
From
Logistics to Supply Chain AGRILINK/Foodlink 2005 held
its first co-organizers meeting last week
DMAP is a co-organizer for the second
year in a row. After last year's theme on Transport,
this year's theme is "Supply Chain Efficiency:
Key to Competitiveness". What a theme! Right down
DMAP's alley. Supply chain efficiency is something sorely
needed, not only by agriculture, but by all industry.
In industry, logistics cost is in the region of 8 to
12% of sales value.
In agriculture it is probably in excess
of 25%, higher for highly perishable products. In general,
the % tends to be higher for products that use refrigeration
(fresh meats, fruits, ice cream) or have returnables
(beverages), or use air transport (highly perishable,
high value, small items), while the % tends to be lower
for very high-value products (pharmaceuticals).
For its own annual conference to be
held in September, DMAP's theme also mentions Supply
Chain. Its theme is "Seamless Supply Chain in an
Archipelagic Environment: A Continuing Challenge".
See below for more details on the conference. We can
now see clear moves towards Supply Chain thinking from
Logistics thinking, not only here in the Philippines,
but elsewhere.
It is interesting to note that the
Council of Logistics Management (CLM), the largest organization
of logistics professionals in the world (perhaps with
over 12,000 members), has, starting Jan. 1, 2005, changed
its name to Council of Supply Chain Management Professionals
(CSCMP).
A few years back it had deliberated
on the correctness of such a move, but decided otherwise.
It seems that the reason for deciding against the change
then was that Supply Chain was seen then as too big
an area for the CLM to cover.
What is the significance of this shift
from Logistics thinking to Supply Chain thinking? For
now, we will quote the definitions of Logistics and
Supply Chain Management given by the CLM/CSCMP, and
also a group of US professors. We will examine the definitions
and the concepts in a future issue.
According to the CLM, Logistics is
that part of the supply chain process that plans, implements
and controls the efficient, effective flow and storage
of goods, services and related information from the
point of origin to the point of consumption in order
to conform to customers' requirements.
According to the CSCMP, Supply Chain
Management encompasses the planning and management of
all activities involved in sourcing and procurement,
conversion, and all Logistics Management activities.
Importantly, it also includes coordination and collaboration
with channel partners, which can be suppliers, intermediaries,
third-party service providers, and customers.
In essence, Supply Chain Management
integrates supply and demand management within and across
companies. A research team led by University of Tennessee
professor John Mentzer has developed the following definition
of Supply Chain Management.
The systemic, strategic coordination
of the traditional business functions and the tactics
across these business functions within a particular
company and across businesses within the supply chain,
for the purpose of improving the long-term performance
of the individual companies and the supply chain as
a whole. Shipping Immersion Course. Last chance to join
this seminar on board a vessel. scheduled for May 6
to 8.
It will be on board the Mary Queen
of Peace, a Negros Navigation vessel, while en route
to Boracay. Speakers will include maritime industry
experts, Ric Romero (designated MARINA Deputy Administrator),
Hector Miole (PPA), Atty. Pete Mendoza (PSB), Prof.
Henry Basilio (UA&P) and Cora Curay (DMAP). Still
on training, the DMAP-DLSU program on Logistics Management
(we have also begun to call this Supply Chain Management)
is ongoing at the DLSU Greenhills campus. Ongoing are
Modules 1 (Evolution of SCM) and 3 (Inventory Management).
Module 4 on Warehousing will follow Module 3. DMAP's
contest for this year's conference theme ended with
its selection at DMAP's last Board meeting on April
5.
The winning theme, as mentioned above,
is "Seamless Supply Chain in an Archipelagic Environment:
A Continuing Challenge". It was submitted by Avel
Acedo of Smart Communications.
DMAP very recently released its invitations
for conference sponsors and advertisers. Donations and
advertising rates are the same as in past years. Principal
sponsor P60,000 Regular sponsor 30,000 Cocktails sponsor
150,000 Luncheon sponsor (2 slots available) 100,000
Break sponsor (4 slots available) 50,000 Principal,
Luncheon and Cocktails sponsors are entitled to a 3
meter x 3 meter exhibit booth.
Regular and Break sponsors are entitled
to a 3 meter x 2 meter exhibit booth. All sponsors are
entitled to one page space in the souvenir program.
Advertising rates for non-sponsors (VAT included) are:
One whole page P6,600 One-half page 3,300 One-fourth
page 1,650.
Address inquiries and comments to Ed Sanchez at tel.
671-8670, fax 671-4793, cell 0918-914-1689, or email
dmap@i-manila.com.ph.
Those interested in DMAP training and other activities
are requested to send their e-mail addresses.
back to
top |
