Transforming Maersk Delivering Integrated Logistics
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Transforming Maersk Delivering Integrated Logistics James Wroe – Head of Ocean Customer Logistics 23rd September 2021 Classification: Confidential
We have gained solid execution momentum and are starting to deliver superior outcomes 2016 2017-2019 2019-2021 2021-2023 2023-2025 Framing the Activating the Gaining execution Achieving superior “Always on” transformation transformation momentum outcomes Transformation Classification: Confidential
Bringing together three strong businesses with significant and tangible synergies Customer Synergies Logistics & Ocean Terminals Services Financial & Operational Synergies Technology
Technology driving competitive advantage Building in-house technology powerhouse Working integrated with the business Customer uptake of digital solutions accelerating Across platforms, channels, and for our digital products Using technology to drive internal efficiency Automation of terminals, fuel efficiency, data products to Technology support decision making
Ocean has become a higher quality business, more resilient at higher earnings levels Reduced volatility CAPEX discipline Agile capacity management Competitive scale achieved Improved view of demand with Hamburg Süd acquisition Long term contracts Grow through efficiency and Ocean focus on replacement Differentiated products Differentiated offerings to meet our customers’ diverse supply chain needs
We have built a strong growth engine in Logistics & Services Improved product portfolio Strengthened organisation Comprehensive product Attracted industry experts with offering Logistics and Service capabilities New digital products while fostering internal talent development Truly integrated logistics for our customers Logistics & Services Expanded partnerships Growth momentum Growing collaboration with Proof points of organic growth customers Accelerated inorganic growth Ocean customers buying more with three successful Logistics & Services products acquisitions
We are on the way to deliver superior returns in Terminals Step-change in results Best-in-class operator Improved ROIC, now ahead of peers New operating model: APMT Doubled EBITDA margin since 2017 Way of Working Realising synergies with Ocean Automation roll-out in modular approach Terminals Satisfied customers Selective growth NPS growing double-digit every Focusing on organic growth and year since 2017 investments in existing locations Expanding offering to create value Selected new investments with for customers synergies with Ocean or best- operator
The next step in building the Integrator Continue the Rapid growth in Focus the portfolio Decarbonise logistics strengthening of Logistics & Services – on the integrator Ocean and Terminals organic and inorganic Classification: Confidential
Ocean and Logistics at a glance +70k ~25m 7%1 ~5m 4%2 ~2m 112%3 ~5m 14% ~13m +70k customers, representing a CBM going through Land Customs Purchase orders FFEs shipped community of 845k unique users our warehouses deliveries declarations managed interacting on Maersk.com and with our +51k colleagues Note: Absolute figures based on FY 2020, growth figures based on H2-20 vs. H2-19; 1. Excl. acquisitions increased by 3%. 2. Carrier haulage % growth; 3. Excl. acquisitions increased by 24% Classification: Confidential
Transportation Origin services Destination services Air Factory Export Warehouse Import/Custom Customer Warehouse Intermodal Shipment Customs Ocean Clearance Warehouse Final Delivery Rail Orchestration The traditional supply chain has been Status Consequences structured around cost optimisation of • Most efficient set up in a static • Need large orchestration layer internally or environment through 3PL to manage the lack of flexibility and standard products or transactions • Vulnerable to external shocks and resilience disruptions • Disruptions cause extra costs which is not possible to capture up front
Transportation Origin services Destination services Export Import/Custom Factory Customer Customs Clearance Shipment Warehouse Warehouse Warehouse Orchestration “Most supply chains are too static and traditional, we need more flexibility, less complexity and fewer hand-overs between the multitude of players” Mark R. Chadwick, Executive Sourcing Leader, General Electric and GSA President
Origin services Transportation Destination services Rail Air Factory Export Warehouse Import/Custom Customer Shipment Customs Warehouse Intermodal Final Delivery Clearance Warehouse Ocean Operational control Technology Our winning aspiration is to create Status Consequences customer value by integrating modules • Today we are building operational capabilities to cover the • Improved customer experience and and leveraging network to provide a whole chain reduced need for orchestration due to elimination of complexity resilient, flexible, and efficient supply • Modular value propositions supported by technology which accommodates for customers’ individual preferences chain end-to-end • Lower end-to-end actual costs • Single point of accountability to deliver a final outcome over time through operational excellence
We deliver 1 Changing our business model to create a more profitable and resilient Ocean, through differentiated integrated value propositions logistics through 2 Strong modular products in Logistics & Services will enable us to build integrated solutions for customers different levers 3 Investments in digital capabilities are new value levers for customers
3 Technological capabilities Technology is critical to deliver integrated logistics – momentum is building up Building in-house technology Accelerating modernisation of Customers are validating our new powerhouse legacy infrastructure digital strategy 1 +2,500 technologists hired 1 Adopted cloud-first, Bookings via Twill increased from 8,919 FFE in 2019 to the last three years, 1,000 scalable and modular 116,822 FFE in 2020 – a growth of 13x more over next year architecture Number of unique customers with recurring usage of Driving greater agility and our mobile shipment application have increased from 2 Adopted best-in-class agile 2 speed to market, while 2,389 end 2019 to 5,273 end 2020 software development methodologies reducing the cost-to-serve Maersk More than 100,000 containers contracted year-to-date Flow 2021 3 Leveraging data as a differ- Targeting over 10,000 Blockchain-Enabled electronic rentiating asset to improve bills of lading in 2021; on track for 100,000 by 2024 quality of our products Classification: Confidential
3 Technological capabilities New digital products create additional customer value 9,000,000 100,000 15 Terminals Truck visits per year Online visits a day With monetised data services Advanced truck appointment system Online self-service tools Data products & services • Allows our customers to optimize their daily • Enable our customers to use, book and buy • Customers can leverage real-time information to planning by booking appointments online services when and how they want optimize their supply chain planning • Digital foundation for gate automation to • Currently over 20,000 registered users on • Aim to launch our industry-first data services via minimise truck turn times apmterminals.com and other platforms our API Store in 22 terminals in 2021 • Basic Truck Appointment System already • Track & Trace functionality has been used • By 2022, all financially controlled gateways will available in 26 terminals, advanced Truck 4 million times in 2020 be onboarded Appointment System currently being developed in two pilot terminals Classification: Confidential
2 Best in class operator example Port Elizabeth Reduced disruptions New Jersey, USA Despite one of the worst winters in recent years, the terminal experienced little disruption and was the first terminal in the complex to open for normal business Customer satisfaction has Leading rail service gone up Safety improved +20% capacity 24 hours after discharge, the Net Promoter Score has moved Following fatalities in recent Terminal can handle +20% more container is on the train headed from -12 (2020) to +5 (2021 YTD) years, the safety volume than two years ago towards the hinterland. This performance has improved compares to 48-96 hours in most This is partly driven by a new and we have won two safety other facilities in the port truck appointment system and awards automated gates Classification: Confidential
A unique value proposition Customer Synergies Logistics & Ocean Terminals Services Financial & Operational Synergies Technology
James Wroe – Head of Ocean Customer Logistics, South East Asia & Oceania james.wroe@maersk.com Classification: Confidential
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