harnessing the competitive advantage of south africa's direct
TRANSCRIPT
Harnessing the competitive advantage of South Africa’s direct pharmaceutical distribution model in Europe using SCOR “Lite”.
JG COWPER MSc. Bio Medical Eng UTI Strategic Services BI Supply Chain Specialist
International pharmaceutical manufacturers desire, both at a strategic planning and execution level, that their primary logistics supply chain partners offer an integrated services platform to gain visibility and derive insights into their distribution channels.
This presentation will detail how a simple rendition of SCOR has been used to encourage adoption of this direct distribution business model abroad and will show case how such a supply chain visibility tool can enable order responsiveness, the management of inventory levels and the mitigation of financial risk.
ABSTRACT SAPICS 2007
South African Pharma direct distribution value proposition
• Direct to pharmacy channel model• Ability to adapt to scale• Maintain product integrity• Migrate from a trading focus to a
fee for professional service • Accurate sales and marketing
detail• Responsive supply chain
performance
Multi-nationals delivering direct in South Africa
The Signature of Quality
®
Migrating a direct distribution business model abroad
ConsumerSupplier
Pharmaceutical Supply Chain Model
Plan
Deliver
Return
Manufacturer Customer
Make Make DeliverMakeSource SourceDeliver
Channel to Market
Source
Return Return
ReturnReturn Return Return
Source Deliver
Return
Pharmaceutical Multi-National
Chemical Supplier
Pharmacy Hospital Doctors Retailer
PatientDirect
Distributor Wholesaler
SCOR enables business model description across different European countries
Italy – Due Diligence
Greece -- Convert a wholesaler into a direct distributor
Germany– Separate Product and Information Flows
UK – Response to RFP
Slovakia – Integrated Service offering packaged into a Control Tower
Italy – SCOR handles the language barrier to facilitate a due diligence assessment.
PLAN (P1-5)
SOURCE (S1) MAKE (M1) DELIVER (D1)
RTSource (SR1) RTDeliver (DR1,3)
ENABLE
Greece- SCOR assist in defining the roles enabling a wholesaler to become a direct distributor
LSP
PLAN (P1-5)
SOURCE (S1) MAKE (M1) DELIVER (D1)
RTSource (SR1) RTDeliver (DR1,3)
ENABLE
Channels to Market (Germany 2005)
Germany - SCOR shows the value of separating product and data flows.
UK – SCOR gives context to a RFP
11
22
33
44
55
66
77
88
99
1010
Network design opportunity exposed through SCOR Mapping – Propose HUB building sequence
Slovakia – SCOR exposes the need for an integrated logistics services platform meeting strategic requirements
ConsumerSupplier
Pharmaceutical Supply Chain Model
Plan
Deliver
Return
Manufacturer Customer
Make Make DeliverMakeSource SourceDeliver
Channel to Market
Source
Return Return
ReturnReturn Return Return
Source Deliver
Return
Pharmaceutical Multi-National
Chemical Supplier
Pharmacy Hospital Doctors Retailer
PatientDirect
Distributor Wholesaler
Pharmaceutical Supply Chain Control TowerPharmaceutical Supply Chain Control Tower
International pharmaceutical manufacturers desire, both at a strategic planning and execution level, that their primary logistics supply chain partners offer an integrated services platform to gain visibility and derive insights into their distribution channels.
This presentation will detail how a simple rendition of SCOR has been used to encourage adoption of this direct distribution business model abroad and will show case how such a supply chain visibility tool can enable order responsiveness, the management of inventory levels and the mitigation of financial risk.
Prof Langley 2006 – Georgia Tech
IT capabilities are a key success factor for client bidsR
ela
tio
nsh
ips
Strategic/Planning
TransactionalVisibility
Clearing &Forwarding
WarehousingDistribution Supply ChainEngineering
Director of Account Solutions
Operational Manager
60% of clients specifically assess a 3PL’sIT capabilities when selecting a provider
(Capgemini Survey, 2006)
Single service Multiple services
Prof Langley 2007 – Georgia Tech
Visibility Tools -
Web-Enabled Communications -
Transportation Man (Execution) -
Warehouse/DC Management -
RFID -
Transportation Man (Planning) -
Collaboration Tools -
Supplier Relationship Man -
Transportation Exchange -
Supply Chain Planning -
Customer Relationship Man -
Customer Order Management -
Yard Management -
Source: 2006 Third-party Logistics – results and findings of the 11 th annual survey
Mu
st H
avesE
merg
ing
N
eeds
Clients are requiring an integrated systems offering supporting a range of logistics services
Re
lati
on
ship
s
Single service Multiple services
VISIBILITY & CONTROL
PLANNING & OPTIMISATION
Must Haves
Emerging Needs
Integrated Supply Chain Services Portfolio
Logistics Services
Logistics ServicesPlanning and Optimisation
-------------------------------------Visibility & Control
How does the Pharma Control Tower map to client strategy?
ADAPT TO SCALE
DIRECT TO PHARMACY
PHARMALOGISTICSSTRATEGY
Pharmaceutical Control Tower
What supports the Pharma Control Tower Functionality ?
Clients have outsourced the logistics function so hide the detail and offer the insights.
Control Tower Platform
Management of inventory – Pipeline Visibility
Order Fulfillment Accuracy
• Orderline completed versus orderlines requested
Sales Growth
• Orderline completed versus orderlines requested
Mitigation of financial risk – DSO Analysis
• Debtors age analysis
Lessons learnt to date, this project has illustrated that:
- SA is a beachhead for supply chain innovation
- SA logistics solutions can be world firsts
- International pharma companies are looking at logistics partners to offer them competitive advantage
- Visibility and control platforms offer a compelling value proposition that differentiate.
- Migrating innovation “overseas” requires significant investment.
QUESTIONS ?