Elevating consumer health logistics

Investments pay dividends

Seamless supply chain solutions implemented to boost consumer sales in South Africa.

Haleon, a global leader in consumer health, partnered with DSV as its logistics solutions provider in January 2024, and sales have exceeded targets since then.

Matthew Henry, Customer Service and Logistics Manager at Haleon, said Haleon had a small inhouse team and outsourced its order to cash function to its previous LSP prior to issuing an RFQ to the market in 2022.

DSV responded, along with other strong players in the Fast-moving Consumer Goods (FMCG) logistics solutions space and in April 2023, Haleon awarded its consumer healthcare business for five major categories – Oral Health, Pain Relief, Respiratory Health, Digestive Health and Other, and Vitamins, Minerals and Supplements (VMS) – to DSV, to go live in January 2024.

Henry said there were two key factors which swung the deal in DSV’s favour, both of which have been validated in the first few months of working together.

Firstly, there was an immediate culture fit. “The transparency, the initial meetings were somewhat different, we really believed in the story, the proposal, the commitment”. 

Secondly, there was the vision and “the ambition around technology and improvements in productivity in your space was something else that we felt, wow, this is a game changer for us long term”.

In addition to these factors, Henry said the fact that other consumer health clients were being serviced from a logistics facility such as DSV Park | Gauteng, helped DSV’s case.

Johan Dekker, Managing Director, Solutions South Africa DSV agrees the culture fit has been important to Haleon’s successful onboarding and integration, as have significant and continued investment in facilities, technology, and people – and the “flawless implementation” that comes from learning, planning and collaboration. 

Planning for failure

By the time DSV was awarded the contract in April 2023, the preparation for the RFQ evolved into months of rigorous, never-done-before planning.

To start, skilled, multi-layered teams were set up to deal with the project at various levels.

Brian Ejsing, Group COO, visited often from Denmark, and DSV’s global Haleon account management team was involved from the beginning and Matthew Henry sat on DSV’s project implementation stakeholder organisational structure.

It was like an “A-team”, to visit, guide and support the project in SA.

Dekker said: “We sent people from SA to Belgium and benchmarked our operations against what was happening there. We used the global reach and resources and learnings at our disposal. But of course, South Africa had its own unique requirements, and it wasn’t a copy and paste.

“We also constituted a strong Project Board which was involved in both internal and external processes. The Project Board asked questions and pushed the internal team, and then there was a Project Board with the customer focus.”

While the planning involved multiple layers of people and different skills sets, it was “planning to fail” that set DSV’s approach apart – because, paradoxically, it strengthened the case for success.

The Advanced Quality Process was driven by DSV’s Mathapelo Mokoena ( General Manager, Projects & Engineering, Solutions), Anthony Wilson (Sales Director, Solutions South Africa) and Haleon’s executive team.

A three-day workshop searched for the unknowns and the fault lines, and when “we found we weren’t on the same page we kept going until we were”, said Wilson.  “This is where what we thought we had sold and what Haleon thought they had bought came together”

The process included the development and implementation of a robust Business Continuity Plan (BCP) to ensure the smooth and uninterrupted operation of critical processes during the project – and DSV had to put in place an interim solution that would allow a switch in just four weeks if an unexpected event occurred.

Planning and scenario testing was intensive. The User Acceptance Testing (UAT) process was rigorous, and pushed deadlines to the limit because it was essentially a negative testing process exploring every conceivable operational scenario. “We were essentially playing devil’s advocate. How can we break the system?”, said Brett Sauerman, Director, Planning and Customer Service, DSV South Africa.

Dekker said much had been learned from what had been done before. “We developed a score card measuring elements like Project Management, the AQP process across all Business Units, our design, critical skills availability, operational management accountability, escalation process, risk factors, roles involved, and so on. This gave us an idea if it was possible to make this a ‘bullet proof’ logistics supply chain. We went through every possible negative scenario because we didn’t want it to happen when we went live.”

Our goal: The perfect order

To deliver this, DSV used a critical enabler, Freight Management Services (FMS), enabling supply chain-wide planning, visibility and the ability to act on the unknown, working together as one with Haleon.

Flawless implementation

Having exhausted every conceivable scenario, we then assumed that the system was good but operationally there could still be a problem, and so we put resources in placeto deal with any eventuality.

We brought in five experienced resources from DSV’s team looking after Haleon in Belgium who could fix things if they broke, along with AM Saskia De Smedt. Some were in SA for three weeks, others for slightly less.

Brett Sauerman: “Even though they weren’t intimately involved in the design, they could help with operational issues if needed, and we had people from Global Sigma’s team on site at Solutions before and during the implementation too. Their role as experts in logistics warehousing best practices including process efficiency, systems design and execution efficiencies was to witness, and provide guidance where needed most.

In effect, three projects were implemented simultaneously:

Henry was impressed with the way DSV’s global tech teams supported Haleon in SA and worked with Haleon globally, probably putting in way more hours than they expected. It was amazing how the operational need was solved”.

While there were frustrations and pain along the way, Henry said he appreciated the spirit in which the teams from both Haleon and DSV worked, often well into nights, to get the job done.

“They were committed to the cause, which was I think, yeah, amazing, really amazing.”

The final move from the previous Logistics Service Provider took place in a cooperative spirit over December 2023 and involved 400 truckloads of stock moving from one location to the other. Inbound went live that month, and outbound started in January 2024.

Milestones

Investing for success

The implementation leveraged investments made by DSV in technology and the facility itself.

DSV’s operational design meant that significantly less space and logistics transport resource was required for Haleon than previously used, and the following innovations were integral to the project succeeding:

• Set up of warehouse, with both pharma and non-pharma chambers, that delivered flexibility and cost efficiencies.
• Drones used drones for inventory control deliver excellent stock accuracy. They are fully autonomous, collect real time data while avoiding obstacles and they prevent theft, save energy, and eliminate unnecessary write-offs. Henry said the drones have been particularly successful in helping cut stock losses.
• A dynamic transport solution catering for variable demand, across diverse market segments and modes by making use of DSV FMS transport resource and technology.
• DSV’s Integrated Planning solution led to the efficient processing of inbound, outbound and reverse logistics and best cost routing.

DSV Park | Gauteng is itself a significant contributor to success, providing a high quality, fully compliant and scalable logistics supply chain solution to consumer health customers in Johannesburg.

It opened its doors in 2021 and is widely considered to be among the leading distribution centres in the southern hemisphere.

The sprawling complex houses a logistics warehouse of 79 000 m², a cross-dock facility of 39 000 m² and office space of 10 000 m² and helped DSV standardise business processes, improve efficiencies and operational quality.

There is 24-hour security, ASIB approved sprinkler system, 100 000+pallet locations, and CargoWrite WMS. The facility is also BS OHSAS, ISO 14001:2015 and 18000:2007 certified and SAHPRA licenced.

A shared culture and commitment to growth

Haleon and DSV agree the success drivers have been:

• A culture fit built around transparency and learning.
• Collaboration was critical – and key to this was an acceptance that there was no preordained perfect way, and that challenges would be resolved as the process was built out.
• Accessibility of senior people at DSV every step of the way.
• Planning and the resources committed to the project.
• A shared commitment to growth in the FMCG space
• The use of technology to improve efficiencies and performance.
• A strict adherence to Quality compliance, with no grey areas and no broken rules.
• A continuous focus on cost effectiveness.
• The investment in a world class facility at DSV Park | Gauteng continues to pay off.