Understanding Your Supply Chain & Reducing The Risk of Supply Chain Disruptions 8th March 2012 Contents DHL Supply Chain - Overview What Does Your Supply Chain Really Look Like? What Can Cause Supply Chain Disruptions? – DHL Examples How Far Down / Up The Supply Chain Do You Need To Go? What Key Information Needs To Be Derived From Your BIA? What Best Practice Can We Draw Upon? Page 2 DHL Supply Chain WHAT DOES DHL SUPPLY CHAIN DO? Page 3 Deutsche Post DHL - Corporate Structure Page 4 DHL Supply Chain - Global Scale and Coverage DHL Supply Chain DHL Supply Chain operations Other DP DHL operations (DP DHL operates everywhere except the Paracel and Spratly Islands) Operates in Over 60 countries Facilities in 2,500 locations Employees Over 140,000 Managed Warehouse space 22.8 million square meters Transportation management Over € 5 BN Page 55 DHL Supply Chain – Europe, Middle East & Africa (EMEA) DHL Supply Chain EMEA Countries Page 6 DHL Supply Chain - Products & Sectors INTEGRATED SUPPLY CHAIN SOLUTIONS Manufacturer & Raw Materials Export / Import Activities Sector Solutions Automotive & Industrial Primary Movement Distribution Centers Healthcare Inbound to manufacturing Service and replacement parts Kitting & Rework Hospital Logistics Technical distribution Infrastructure Logistics Temperature assured Technical services In-Plant services Direct to pharmacy Service parts logistics Patient transport Reverse logistics Environmental Compliance After-sales and Reverse Logistics Services B2B & B2C Distribution Retail & Fashion Consumer Technology Secondary Movement Clinical trials logistics Pharmaceutical grade logistics Inbound to manufacturing Contract manufacturing Assembly and configuration Co-packing International supply chain management Shared-user and campus solutions Distribution to stores In store logistics Ambient and temperature controlled Home delivery Consultancy services, Lead Logistics Partner services, Procurement services, Sustainability services Page 7 Contents DHL Supply Chain - Overview What Does Your Supply Chain Really Look Like? What Can Cause Supply Chain Disruptions? – DHL Examples How Far Down / Up The Supply Chain Do You Need To Go? What Key Information Needs To Be Derived From Your BIA? What Best Practice Can We Draw Upon? Page 8 DHL Supply Chain – Example AIRSIDE REGIONAL DC NETWORK AND/OR OUTBASES UK MANUFACTURER / SUPPLIER OPTIMISED TRANSPORT WAREHOUSING & ORDER FULFILMENT REGIONAL DC NETWORK AND/OR OUTBASES OPTIMISED TRANSPORT MERCHANTS/ FRANCHISES END CONSUMER INTERNATIONAL SUPPLY CHAIN SERVICES OVERSEAS MANUFACTURER NATIONAL DC REGIONAL DC NETWORK AND/OR OUTBASES RETAIL STORE REVERSE LOGISTICS Page 9 Contents DHL Supply Chain - Overview What Does Your Supply Chain Really Look Like? What Can Cause Supply Chain Disruptions? – DHL Examples How Far Down / Up The Supply Chain Do You Need To Go? What Key Information Needs To Be Derived From Your BIA? What Best Practice Can We Draw Upon? Page 10 BCM Backdrop - Recent Business Disruptions Ash Cloud, April 2010 Moscow Heat Wave/Smog, Aug 2010 Swine Flu, 2009 UK Snow Coverage, Nov 2010 UK Civil Unrest, Aug 2011 Example Site Incident, June 2011 UK Industrial Action, Nov 2011 Unexploded Bomb Hungary, Dec 2011 Nigeria Fuel Strikes, Jan 2012 Page 11 Contents DHL Supply Chain - Overview What Does Your Supply Chain Really Look Like? What Can Cause Supply Chain Disruptions? – DHL Examples How Far Down / Up The Supply Chain Do You Need To Go? What Key Information Needs To Be Derived From Your BIA? What Best Practice Can We Draw Upon? Page 12 DHL Supply Chain – Example AIRSIDE REGIONAL DC NETWORK AND/OR OUTBASES UK MANUFACTURER / SUPPLIER OPTIMISED TRANSPORT WAREHOUSING & ORDER FULFILMENT REGIONAL DC NETWORK AND/OR OUTBASES OPTIMISED TRANSPORT MERCHANTS/ FRANCHISES END CONSUMER INTERNATIONAL SUPPLY CHAIN SERVICES OVERSEAS MANUFACTURER NATIONAL DC REGIONAL DC NETWORK AND/OR OUTBASES RETAIL STORE REVERSE LOGISTICS Page 13 DHL Supply Chain EMEA – Warehouse & Transport BCM fully in place across our Warehouse & Transport operations Page 14 DHL Supply Chain – Example End to End Business Resilience AIRSIDE REGIONALSuppliers DC Internal UK MANUFACTURER / SUPPLIER OPTIMISED TRANSPORT WAREHOUSING & ORDER FULFILMENT NETWORK Finance Function AND/OR Fuel Centre OUTBASES IT Data Centre HR Function Regional Engineering Fleet Compliance Etc… REGIONAL DC NETWORK AND/OR OUTBASES OPTIMISED TRANSPORT MERCHANTS/ FRANCHISES END CONSUMER INTERNATIONAL SUPPLY CHAIN SERVICES NATIONAL DC REGIONAL DC NETWORK AND/OR OUTBASES OVERSEAS MANUFACTURER External Suppliers Agency Providers MHE Suppliers Vehicle Maintenance Providers Caterers Etc… RETAIL STORE REVERSE LOGISTICS Tier 2 Suppliers Tier 3 Suppliers Page 15 DHL Supply Chain EMEA – Functions Engineering & Fleet Services - UK & Ireland EMEA Data Centre, Prague BCM fully in place across our Functions and Data Centres EMEA HR People Service, UK EMEA Finance Page 16 Contents DHL Supply Chain - Overview What Does Your Supply Chain Really Look Like? What Can Cause Supply Chain Disruptions? – DHL Examples How Far Down / Up The Supply Chain Do You Need To Go? What Key Information Needs To Be Derived From Your BIA? What Best Practice Can We Draw Upon? Page 17 What Key Information Needs To Be Derived From Your BIA? You can’t protect what you don’t know! The purpose of a BIA is to identify: Your critical activities and functions and their independencies The minimum acceptable level of service for those activities or functions The Recovery Time Objectives (RTO) and Maximum Tolerable Period of Disruptions (MTPD) for those activities or functions What resources are needed to achieve these minimum levels of service Page 18 Contents DHL Supply Chain – Overview What Does Your Supply Chain Really Look Like? What Can Cause Supply Chain Disruptions? – DHL Examples How Far Down / Up The Supply Chain Do You Need To Go? What Key Information Needs To Be Derived From Your BIA? What Best Practice Can We Draw Upon? Page 19 DHL Supply Chain Aligned to BS25999 – British Standard for BCM Page 20 EMEA BCM 10 Steps - Aligned to BS25999 BCM Policy Site has clearly displayed the BCM Policy Statement and has communicated this to all collegues on site. Site has created a Site BCM Scope and Strategy document 1 Provision of Resource IMT 2 Site has appointed a BCM Champion with appropriate seniority to be accountable for implementing BCM 3 BIA Site has formed an Incident Management Team with deputies for all key functions Site has completed the DSC approved BIA document and identified activities that support its key products and services, the MTPD, RTO and its priorities for recovery of its critical activities 4 BIA Risk Assessment Determining Choices Site has completed the DSC approved BIA Risk Assessment document and has identified and documented the site’s threats 5 Determining BCM Strategy BCP’s Maintaining and Reviewing Testing and Exercising Using the DSC approved Risk Assessment document the site has, for each of its critical activities, identified available risk solutions 6 Site has determined how it will recover each critical activity within its recovery time objective, including the resources required for resumption 7 Site to create BCP‘s for all possible risks that could affect critical operations and the BCP‘s are to detail how to manage the incident and how it will recover its activities 8 Site has ensured that it‘s BCM arrangements are reviewed and documented at planned intervals 9 10 Site IMT has successfully carried out 3 table top exercises in the past 12 months and any lessons learnt have been incorporated into future plans Page 21 DHL Supply Chain BCM Tool – Currently Under Development Improved Visibility Communication Improved Efficiency Robustness Improved Consistency Simplicity Page 22 BCM Contacts - EMEA For more information about the DHL Supply Chain BCM approach, please contact: Graham Clark – Business Continuity Manager – EMEA [email protected] Page 23
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