Growth a hot issue for coffee company

Most companies are now well aware that improvements in supply chain operations can lead to new efficiencies and cumulative costs savings, but they are not always sure where to start when implementing best practices and gauging new systems.

Therefore, Peter Wong, chairman and chief executive of Tsit Wing Coffee, will address this topic at the conference, with reference to his company's initial objectives and ongoing experience.

The company realised it was essential to strengthen the different functions in its supply chain to drive operational excellence. This was all part of the company's vision of becoming a world-class food and beverage service provider, and was closely tied to the twin aims of achieving continuous growth and responding as necessary to changing customer expectations.

Tsit Wing decided to use the supply chain operations reference (Scor) model developed by the Supply Chain Council, a not-for-profit trade association set up in 1997 whose members include companies of all sizes and from diverse industries.

Mr Wong said that the well-tried Scor model offered performance attributes for companies to measure their success in achieving their desired positioning in a competitive marketplace.

It provides a unique framework that links business processes, metrics, best practices and technology features. Together, these form a unified structure to support communication among partners, improve effectiveness in all areas of supply chain management and identity where improvements are needed.

'Applying Scor has let Tsit Wing understand the strengths and weaknesses of its supply chain,' Mr Wong said.

The result of this was that the company could upgrade the overall standard of its supply chain systems, adopt best practices and achieve internationally recognised benchmarks.

For Tsit Wing, the scope of the project is covering strategic planning and functional management. This means that the company will re-examine every process from procurement and production to warehousing and distribution, and the management of the related information flow.

Those diverse functions are separated into clearly defined areas such as Plan, Source, Make, Delivery and Return.

The project began in March this year and, once all the distinct phases are completed, should conclude in the second half of next year.

'We are expecting significant and encouraging improvement over the company's supply chain reliability, responsiveness, flexibility and cost of operation,' Mr Wong said.

Meanwhile, GSI Hong Kong has been fully involved and, according to Mr Wong, is playing a 'catalytic role' in bringing a paradigm shift to Tsit Wing's supply chain management.

'They provide a professional service from consultancy analysis to project management, execution and measuring results,' he said.

Anna Lin, chief executive of GS1 Hong Kong, said that the Scor model had been developed in the United States and was pioneered by companies involved in the manufacturing of hi-tech products. Subsequently, many Fortune 500 companies had adopted it, but enterprises of any size could benefit from applying the principles, definitions and benchmarks.

Ms Lin said that government funding would be made available to support GS1 Hong Kong's Supply Chain Maturity Reference Model to help local small and medium-sized enterprises (SMEs) reach a certain maturity level in process before adopting Scor.

'There won't be changes to the model because it is global, so basically the concept will be to explain to SMEs about the 'enabling blocks' which they need to improve, for example, their inventory management.' She said this was especially important because all the elements necessary for high-level supply chain management would then be in place to support expansion.

'If your organisation grows you will still be able to align everything with the process model,' she said.