People come first in global express industry
Reports by John Cremer
TNT has made this a central tenet of both its staff training and business development approach as it targets growth of 15pc this year
ADVANCES IN technology, coupled with the greater complexity of the international supply chain, have had a significant impact on the global express industry in recent years.
However, when asked to identify the key factor which makes their businesses successful, leading players in the sector generally point to just one thing - people.
'In my 14 years in the field, I've seen the so-called 'brick-to-click' transformation, with the old emphasis on warehouse facilities being replaced by a focus on systems solutions,' said Ambrose Linn, deputy country general manager for TNT Express Worldwide (HK).
'The most important thing, though, is still the way you care for your customers and your employees.'
TNT has made this a central tenet of both its staff training and its approach to business development. It is targeting growth in Hong Kong of more than 15 per cent this year and has plans to establish up to 100 branches in China in the next six years.
Much of that expansion will depend on increasing its portfolio of high-end customers - the type who expect consistent service excellence and individual attention.
'We believe the overall prospects are rosy,' Mr Linn said. 'More and more manufacturers now prefer to ship by air freight and global express. The lead times for factories to complete orders are being shortened and transit times are getting tighter.'
He said that the time-sensitive electronics sector showed how things might develop.
Some companies now budget up to 15 per cent of the retail price of an item for the logistics element, as opposed to the average of about 2 per cent for fast-moving consumer goods. If that means on-time door-to-door delivery, lower inventories and higher sales, it is considered a sound investment.
'We are no longer selling a standardised product, but focus instead on value-added solutions,' Mr Linn said. 'As a third-party logistics (3PL) provider, we also act as a kind of policeman or auditor to do quality checks and inspections for customers.'
The current value-added services extend from bar coding and affixing price tags to creating 100 per cent transparency through multiple status updates. These are traceable via the company's website and include, for example, updates on 'departure ex factory', flights, customs clearance and proof of final delivery.
Playing to these strengths, TNT has targeted industries for which avoiding an out-of-stock situation is critical. In dealing with the semiconductor, computer peripheral and high-end fashion sectors, it has put a premium on 'velocity' - achieving the fastest possible transit times and reliably meeting tough deadlines.
This has gone hand in hand with the introduction of new technology catering to increasingly sophisticated user needs.
'Since every customer has different logistics requirements, we take great care in finalising workflows, fixing standard operating procedures and signing off EDI [electronic data interchange] interfaces,' Mr Linn said. 'Everything must be solutions-based and may mean new procedures, but this flexibility gives us an edge when planning new products.'
An example is TNT's pioneering service for medical organisations doing clinical trials. They are collaborating with pharmaceutical companies, hospitals, private clinics and laboratories to provide an express service for medical test results, diagnostic specimens and DNA matching.
'There is ample potential for this kind of life sciences business,' Mr Linn said.
'It can be extended to moving human tissue, urgently needed medical equipment and items which must be kept in precise temperature-controlled environments.'
The company sees such projects, with their broader context, as a way for staff to gain inspiration from their jobs. Besides that, though, a system of performance appraisals and 'career pathing' has been implemented, so that individuals can make known their aspirations and have an idea about career options.
Total head count in Hong Kong is close to 500 and a 10 per cent increase is expected during the year. In particular, TNT will make a point of providing opportunities for middle-aged job seekers who have the general experience, integrity and enthusiasm to do well in the industry.
Openings are expected in sales, customer service and operations as volumes expand.
Looking ahead, Mr Linn acknowledged that Hong Kong will face stiffer competition from other airports in the Pearl River Delta region, but believes it will remain a gateway to China and a major logistics hub.
'There are still clear advantages in terms of flight connectivity, schedule stability, hardware and software. These are all supported by people with the necessary skill sets, but more should be done to position Hong Kong as the premier air freight gateway for the region,' he said.