ECR AP - GS1 Hong Kong Supply Chain Management

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Chris: Touching Live Improving Values: We often hear that branded goods companies try to form relationship with consumers and individuals recognising the uniqueness of all of us. How do you do that when there are billions of us Glenn Jordan: That is a wonderful question. We look at the current development of technology and digital marketing and that is the best ever opportunity for a business to do marketing. I have so many examples. One of our customers created a Facebook page for us. Our consumers are doing our marketing for us 10 to 20 times over. It is the future. Now it is only the beginning. Chris: So it seems that digital Glenn Jordan channels are important and businesses have high expectations of the benefits from engaging digitally with consumers. So Harish how are digital channels treated in Unilever Harish Manwani: There is one single trend what will change the world: emergence of digitalization. Both in the way we do business and the way we market our brands and talk to consumers. If I take e- commerce this is unstoppable and these are trends which will change the way all of us do business. Of course it is not that simple and you still need fulfillment. The other bit is how we talk to people. It is fundamentally changing. It has completely changed comparing how we did marketing 3 years ago and how we do it today. The big change is the control. We all controlled our environment. Now it is all about earning media. Consumers are creating content. They take brands into their own hands. It is not in your hand anymore. What we are doing is to train people in the organisation who are comfortable with these trends and technologies. In the last one year we had the most extensive training in what is happening in the digital world. I have a mentor who just joined the company. Younger people are better in this. So the first important element is Awareness in partnering. Second: Work together and see whether we can bring some method into this fast growing viral environment. Both the way we talk to consumers and the way it moves from own to earn are important. Last bit is the impact of digital: The importance of organisation reputation and character. You do something wrong today the world knows it today. The idea of closed door and running business from offices are gone. Our business is not owned by us. The consumers own the business. Chris: I would like to have a retailer view. How can you maintain collaboration with suppliers when your goals are not aligned Isn’t conflict inevitable Seah Kian Peng 26 Seah Kian Peng: The key for parties is to sit down to talk and align the objectives. If you are open and honest enough then it is possible. It can be win-win situation. The key is to understand each others’ objectives, find the commonalities, align some of these and work out the business plan accordingly. This is not new here. Many retailers do it. We would like to do even more. It has achieved results. With regard to digital, there is no way to get away from online trends. Running away from it won’t help. If you get into it you will learn from it. If you do good things, the customers will know it also. It’s not only about bad things. That is the power of social media. Glenn Jordan: Let me jump into potential conflicts between retailer and manufacturer: there is a different mental model we call it constructive tension. There are always going to be differences but if you have the same objectives in your mutual case of serving customers better then you always find areas to work on together. We should carry a different mental model: not conflict but constructive tension. Working together we will come out better. Chris: Do you think this has become how we normally do business Do you think that the collaborative model is embedded enough Glenn Jordan: We are all learning. It is happening faster here in Asia. Probably in 2 years’ time we will say yes we understand collaboration. Scott Price: All of the comments are very relevant. 8 years ago Facebook did not exist. The changing behavior is extraordinary. In Japan for example 50-60 year old customers are very comfortable to go on line. The challenge collaboratively is to manage the digital reputation. Trust becomes even more critical. There is huge daily vote on branded products whether you should select one product or another. There is a big challenge of things spreading very quickly even if they are not true. It can harm your reputation very quickly. So you have to much more proactively offset. Chris: I guess you have to monitor closely what people are saying online and be aware of what is being discussed. Scott Price: Most multinationals have an emerging social media strategy. We have a lot of work to do. Today I do not think that anyone is 100% confident that they understand and react properly. Glenn Jordan: Back to e-commerce: Asia is leapfrogging in technology. Asia is going to be bigger in e-commerce than any other continent. We have such a unique opportunity to shape the future. It is happening now. Chris: IBM surveys say that Asian consumers are far more willing to adapt this interaction method. 26
Chris: Back to talent development. What do you think it is best practice What should companies do to attract the best talent and help them grow in this fast growing market Harish Manwani: I am sure there are many best practices in companies. From our point of view: 1. Recruiting talent: we take 800 management trainees each year and most of them are in emerging markets now. We believe that building local talents is critical. Also you have to understand the 80% of the population is here so there are a lot of talented people 2. Making sure that you train people a. send them to training etc. b. you have to leverage the power of our presence in 170 markets. The good news is that 90% of our employees are local, but large numbers of them have worked outside. 3. We have to change the way we look at talent: Earlier, multinational said Think Global Act Local. It has to change. I do not want people sitting in China thinking global. I want them to think local. Consumers in China won’t say that I am a global consumer. So you have to THINK LOCAL and at the same time ACT GLOB- AL. It is very important to build talent with local insight. The balance between local and global is absolutely critical. Building local insight and thinking local is critical. In India when you join as a management trainee from anywhere from the world you spend 2 months living in a village, actually working on community projects in villages. Once trainees do it they love it. This is how you keep in touch. You cannot become a marketer unless you sell soap in the villages. This is a value system that makes good successful businesses and builds talent. Chris: I don’t think Harish knows this, but I started my career as Unilever <strong>Management</strong> trainee! How about you Scott How do you attract and retain talent Scott Price: I did not actually start as Unilever Trainee but as Coca- Cola trainee! The demographics of workforce and the demand dynamics has changed dramatically. You used to have time to develop people before they were tasked with financially huge brands. With the speed that the multinationals came to Asia they all built multibillion businesses. But the education processes was not able to keep up. We are all struggling and there is a race for talent. The demographics also change dramatically. You have markets where the aging of the population is significant. You have markets where females are not allowed to engage in the workforce. In Walmart we try to address these gaps. We have training programs for females. But the net at the end is eventually you need a more locally empowered talent pool. 99% of our employees are local but we have higher turnover rate. So we try to figure out programs to more engage talent in long terms careers. I think it will take 20 years until the education and the experience curve caches up with the demand. Chris Cave Jones Scott Price Harish Manwani Audience question (Ivett Nagy): I am very frustrated as a shopper when I do not find my product on the shelf. I know from <strong>ECR</strong> that you spend a lot of money on supply chain and somehow it still does not work properly. What are you going to do about it Scott Price: Oops! In fact I met several suppliers on this topic yesterday. I feel for them. It is not easy. Glenn Jordan: Vice Versa Harish Manwani: I think it is such as important point. We talk about strategy, but execution is strategy in our business. If you cannot deliver the right product to the right shelf in the right channel every day you won’t win. I am sure everybody in our business understands that our P/L is determined by the last mile of our business. I really believe that the work we do with partners to try to connect our supply chain is helping us doing this. I do not say that it is perfect. If it was than we would not have a job. This is an on-going thing. Expectation from service level is rising and honestly it is good for our businesses to have higher and higher expectations. Glenn Jordan: It has to be on the top of our agenda. It is an issue of capabilities, an issue of dislocation between the speed we are growing and the speed we build capabilities and it is a good reminder that we have to work collaboratively. It has to be at the top of our agenda. Seah Kian Peng: We still have to make sure that we do our basics better. Going back to Human Capital: It is key in everything. I would like to touch this point: we see that people join a workplace for a variety of reasons: remuneration, career aspects are important but other aspects are increasing: whether they believe in the values of the company, such as sustainability. Glenn Jordan: 20 years ago we never had this challenge with talent. The reality is that there will be a lot of rotation, mobility. So the companies that people will choose are the ones who can think differently. So companies have to build processes which allow that to happen without interrupting the business. Harish Manwani: In the past we always talked about loyalty as premium. It has to be shifted from loyalty to commitment. Glenn Jordan: We think about formation and not organisation. Scott: Price: One customer gave us this feedback in China:” We want you to have this cereal. This one but without the raisins.” Customers are becoming incredibly demanding. We used to think that 50,000 SKUs in a store were enough to satisfy our customers. But that is why people rushing on-line. Because they can find 100,000 - 1 million SKUs. So it is not only a supply chain challenge but also customers are demanding much more than a retailer could potentially provide. So it is an interesting dynamic. Customer demand is a very powerful engine of change. 27 27
Page 1 and 2: 1 ECR AP - The need for collaborati
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Page 5 and 6: 5 ECR AP Sustainability - Walmart B
Page 7 and 8: Michael Haas is introducing: 7 METR
Page 9 and 10: 9 Introducing ECR Hong Kong MILESTO
Page 11 and 12: 11 ECR Asia Country News-Thailand D
Page 13 and 14: 13 Russia is on the way to Electron
Page 15 and 16: 15 THE CONSUMER GOODS FORUM The Con
Page 17 and 18: 17 ECR Australia News Winning at th
Page 19 and 20: 19 With over 400 delegates from acr
Page 21 and 22: Third, for us, sustainability isn
Page 23 and 24: Harish Manwani : PEOPLE “The futu
Page 25: CEOs’ Panel Session with Scott Pr
Page 29 and 30: ECR AP Award WINNER E-commerce Inno
Page 31 and 32: 31 ECR AP Award Bronze Integration

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