PSA Leveraging on Technology to Stay Connected
1. Finish this sentence: Today’s modern supply chains are more than just a back-end channel to deliver products on time, they are a...
...complex, global interwoven network of demand and supply signals and requirements. If well managed, it can be a competitive differentiator for the company. Otherwise, as we have seen, it can cause production stoppages and in some cases, bring a company to its knees.
(Source: PSA)
2. How did PSA leverage technology to manage the supply chain effectively during the pandemic?
The pandemic has shown how important a seamless and resilient global supply chain is to businesses and individuals. As a global port operator and supply chain player, PSA has been working closely with our partners and customers to support them through their changing needs. In addition to deploying additional resources to help shipping lines catch up on vessel schedules and fulfil cargo connections in our ports, our PSA Cargo Solutions arm has also developed digital and physical supply chain solutions for cargo owners based on their pain points and needs: these include real-time track-and-trace visibility; notifications and alerts on cargo movement and status; priority discharge and express delivery, among others.
At PSA, we believe that collaborative co-creation is key to developing solutions that make a real difference. Supply chains are extremely complex, interconnected and interdependent, with many parties involved. A solution that really adds value will be one that tackles pain points from a system-level point of view. In this aspect, PSA has been a founding partner in a number of industry initiatives like the Global Shipping Business Network (GSBN) and national initiatives like SGTraDex in Singapore to enable trusted and secure data sharing for supply chain stakeholders.
3. PSA shifting from port operator to supply chain solutions provider – what are the main driving forces for this shift?
PSA’s core strength has always been in providing supply chain reliability, productivity and enabling growth through our container terminal operations. In recent years, we identified some structural shifts in production and consumption trends. With Industrial Revolution 4.0 disrupting traditional industries and manufacturing, we saw increasing cross-integration between e-commerce and the logistics sector. To cope with changing consumer expectations, cargo owners were also seeking greater control and agility over how their goods got to market, to sharpen their brand differentiator and competitive edge. Building on our strength in connecting supply chain nodes, our global footprint and our existing expertise in port community systems, PSA decided that we could move to play a larger role in the supply chain ecosystem and offer cargo owners solutions that combine our physical expertise with digital integration and which could be more sustainable.
We believe that supply chains and businesses can be agile, resilient and sustainable only when the physical, regulatory and financial aspects of cargo flows are smoothly integrated. That is what PSA seeks to achieve via CALISTA®, a digital trade facilitation platform that brings together key activities of cargo logistics on the global supply chain.
4. How are some ways PSA is collaborating with its customers and suppliers in terms of adding value?
In Europe, Metsä Board (Metsä) is a leading producer of premium fresh fibre paperboards and big on sustainable bio-economy. In addition to tapping the digital capabilities of CALISTA® for customs declaration and Verified Gross Mass (VGM) submission, our PSA Cargo Solutions unit developed for them an integrated suite of solutions including terminal handling, warehousing, stuffing and barge transportation. Our solutions have helped to optimize the physical flow of their goods and reduced their CO2 impact.
In Indonesia, we designed and are managing the supply chain for a large-scale hydroponics greenhouse farm, to enable their produce to be sold both domestically as well as internationally. Leveraging real-time port info, operational flexibility, compliance expertise and good working relationships with government agencies, PSA Cargo Solutions has reduced their costs as well as cargo lead time from farm to store. Visibility through CALISTA® completes the seamless end-to-end process.
(Source: PSA)
5. By augmenting PSA’s current physical and digital capabilities, what are some new initiatives or new services coming into the market?
The current pandemic and its resulting disruptions have amplified the need for a trade ecosystem that not merely works but is also sustainable. Digitalisation is also expected to continue to accelerate across industries. By leveraging PSA’s global network of ports and inland terminals, major touchpoints of ocean shipments and intermodal transfers, we will continue to seek collaborations with logistics service providers and Beneficial Cargo Owners (BCOs) to develop holistic cargo solutions to help enable optimised, resilient and sustainable supply chains for all stakeholders. We have also expanded the offerings on the CALISTA® platform to enable end-to-end control tower visibility for customers to have a strategic overview of their supply chains.
(Source: PSA)
6. What are one or two areas where you have added the most value to your organisation during this time?
It has been less than a year, but the most important change has been formalisation of the Procurement Transformation program, which provides the framework and a multi-year roadmap to guide us towards being more holistic, data and value-driven in procurement activities. Compliance is important and we are also broadening it to be more ESG-oriented and proportionate risk based.
One tangible example of the value-add is PSA business units are able to benefit from the Group’s counsel in terms of sharing good practices, coordination of common events, comparison of benchmark prices and minimization of post-tender interventions. Over time, we will also be able to expand our library of proven category strategies and commercial templates for easy replication.
7. What are some bigger goals you have set for the team moving beyond post Covid?
We have made good progress across the 5 Ps of: People, Process, Platform (system and data), Pricing and Performance management. I would like to make more headway on simplifying processes and unifying it with our Procurement system and data. The journey towards sharpening our competitive and commercial strategies continues especially as we see some inflationary pressures and the need to minimise impact from opportunistic pricing by some suppliers. Sustainable procurement will also be important as PSA continues to pivot towards lower carbon solutions (e.g. through the electrification/hybridization of port equipment). Finally, this will happen through the passion and competence of our staff. PSA operates in 26 countries, and hopefully, our global staff will have a chance to connect F2F in 2022/3.