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Supply Chain Management Association of the Philippines

I had a long recent conversation with one of last year’s conference speakers, Raymond KM Moy, IBM’s ASEAN Regional Manager for the Distribution Industry and General Business.

His questions about how SCMAP started led me to recount the beginnings of the association, when I was in a unique position to call together in 1989 the first eight companies that formed the core group of DMAP (Distribution Management Association of the Philippines), the forerunner of SCMAP. I had retired a year earlier from Unilever and joined San Miguel Corp. The Soap and Detergents sub-group included Unilever, Procter & Gamble, Colgate and Johnson & Johnson. The San Miguel sub-group included SMC, Coca-Cola, Nestle and La Tondeña.

DMAP was formed to counter the CISO cartel of shipping lines, the forerunner of DSA and now PLSA. After being granted huge freight rate increases by MARINA in 1989, the cartel again asked for an increase, this time +39%.

Actually DMAP was also formed to serve as a venue for information exchange by practitioners and to form a unifying group for diverse practitioners such as warehouse managers, distribution managers, transport managers, inventory planners, shipping managers, traffic managers, distribution planners, procurement managers, materials planners, etc. The term logistics was not even in use then. However the urgency of the onslaught of the CISO rate increases set the tone for the early years of DMAP.

There were also battles to be fought with the cargo handlers and the truckers’ groups with respect to rates. The government authorities in Metro Manila were imposing/proposing regulations on truck bans and other restrictions. Soon LGUs also began to impose their own ordinances on truck bans and parking fees/passing through fees.

Thus the early years of DMAP were largely spent fighting high rates and disadvantageous impositions by the government.

Yet DMAP did not ignore its other role of developing, advancing and disseminating information on logistics. Barely two years after formation, DMAP began to organize seminars and forums, and workshops, and eventually the annual logistics conference.

This is why SCMAP became a “two-faced” organization. One face is being a cause-oriented organization; the other face is the role of information dissemination and training.

As a cause-oriented organization, DMAP directly sought improvements in logistics and supply chain process by fighting rate increases, disadvantageous government impositions, cartels, regulatory capture. True to its nature of cause-orientedness, DMAP utilized various tactics and “weapons” such as writing to legislators, participating in a newspaper advertisement letter to Erap, organizing, attendance in meetings, forums, even a march to Mendiola.

An Achiever Organization

IMPROVEMENT OF SUPPLY CHAIN PROCESSES — DIRECT IMPROVEMENT IN SUPPLY CHAIN COST

  • Reduction and deferment of shipping rate increases (1990 to 2003), including abolition of the 0.3% valuation charge in shipping rates in 1990, achieved through continued participation in MARINA hearings and filing of cases;
  • Opposition to shipping deregulation rules that pass on the burden from shipping lines having to prove the need for rate increase, to cargo owners having to disprove the need for rate increase;
  • Filing of cases questioning the legality of MC153 on deregulation;
  • Filing of cases vs. unilateral 20%, 6% and 7.5% increases imposed by shipping lines;
  • Reduction and deferment of cargo-handling rate increases, achieved through continued participation in PPA rate hearings, submission of position papers, inputs to PPA on cargo handling rate structure;
  • Opposition vs. pass-on to cargo owners of funding for port workers’ social amelioration fund;
  • Trucking rates negotiation with INHTA; and
  • Opposition to large unjustified toll rate increases.

IMPROVEMENT OF SUPPLY CHAIN PROCESSES — SERVICE IMPROVEMENT

  • Opposition to implementation of EO 59 monopolistic provisions/no public bidding, and subsequent equivalent unsolicited proposal and single terminal operator;
  • Advocacy of revision of PPA charter which contains conflict of interest; also advocacy of policy on competition;
  • Performance appraisal of domestic shipping lines;
  • Support for and inputs to EO170 and 170A on Road RORO Transport System and advocacy of shipping alternatives;
  • Conversion of TRB truck ban at expressways to load limits. Opposition to a 15-hour Manila truck ban. Opposition to a proposed odd-even traffic scheme; and
  • Implementation of trucking service standards with INHTA.

DEVELOPMENT, ADVANCEMENT AND DISSEMINATION OF SUPPLY CHAIN KNOWLEDGE

  • Holding of various forums with government officials and private groups as speakers, on topics such as truck ban, hijacking, EVAT, shipping deregulation, RORO project, ports projects, road projects, trucking, shipping lines plans, bar coding, citizens’ crime watch seminar, etc;
  • Annual logistics/supply chain conference & exhibit;
  • Annual shipping/logistics immersion courses on board vessel;
  • Seminars/workshops/forums — on warehousing, introduction to supply chain management, logistics outsourcing, leadership, quantitative approaches to logistics planning, basic shipping course, forum on measuring logistics performance;
  • Speaker and participation in, and endorsement of, international logistics conferences;
  • Surveys on distribution practices, shipping procedures, hijacking, trucking rates, pallets, third party logistics, warehousing shipping lines appraisal, benchmarking project;
  • Contacts and lectures with the academe (De La Salle, UA&P, MIT, TIP), SCMAP-DLSU program on SCM;
  • Cooperation with JETRO and AOTS on logistics conferences, consultations, training;
  • Development of a certified logistics master program under guidance of JETRO and in cooperation with PCCI;
  • Publication of a regular column – “SCMAP Perspective” in PortCalls newspaper;
  • Listing with the Council of Logistics Management as a trade and professional organization; and
  • Participation in various conferences, congresses, council work with government and private groups (MARINA, PPA, PLSA, DOTC, MMDA, SPAC, PSB, DTI, PCCI, etc.) Key role in CSPM (Coalition for Shipping & Ports Modernization).

This year SCMAP is expanding its external activities, reaching out to more and more organizations. The new activities of SCMAP deserve a separate issue.

Looking back, it is fair to say that had DMAP not been formed, shipping and cargo handling rates would be much much higher now. One cannot help but feel proud of SCMAP’s accomplishments.

As Raymond Moy said to me, there is no similar or equivalent organization in Singapore. Probably true in some other countries?

Address inquiries and comments to Ed Sanchez at tel. 671-8670, fax 671-4793, cell 0918-914-1689, or email scmap.org@gmail.com. . Those interested in SCMAP training and other activities are requested to send their e-mail addresses.

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