Dialogues

A Shift in the Right Direction

Interview with Brian Miles, Regional Managing, Director, SSI Schaefer Asia Pacific, Middle East and Africa

Many things can happen to a man within forty years. Mr Brian Miles, now the Regional Managing Director of SSI Schaefer Asia Pacific, Middle East and Africa, used to be a simple salesman for a major material handling company in the United Kingdom. When SSI Schaefer started in Singapore in 1984, Mr Miles only had a team of seven staff to manage.

Now, he is responsible for managing 19 SSI Schaefer offices in Asia Pacific and the Middle East in 16 countries and two wholly-owned factories in Malaysia and China, employing more than 1,000 people. Looking back when he first started working in the industry, Mr Miles reminisced about buying his first calculator. “When I first started working in 1969, I was given a ready reckoner to assist in preparation of quotations. In 1971, I decided to invest in a Sinclair calculator, it cost £25, which was equivalent to a month’s salary. Within a couple of years, the cost dipped to £5. That’s what happens to prices of technology over time.

The development cost is rapidly recovered and market cost will quickly reduce, I see the same with the use of robotics within the warehouse” says the Managing Director. In this issue of Supply Chain Asia magazine, with over 40 years of industry experience under his belt, Mr Miles shares his views on the future of SSI Schaefer, the strengths of the Asia Pacific region and the challenges of the supply chain sector.

A change in the winds

It is hard to imagine one person managing three of the world’s biggest markets, but that will change for Mr Miles. SSI Schaefer has developed four global hubs – Asia, Middle East, China and Australia – that operate independently with its own respective profit and loss reports.

“Our growth in this region has been tremendous for the past 30 years. It has come to a stage now that one person cannot control a third of the world. This is why we have established hubs to become competency centres. This means that each hub will be expanded to develop and promote automation systems and will be equipped with its own application engineering capabilities, which includes the ability to analyse, design, conceptualise, working closely with our respective European factories to create an automated solution, then commissioning and providing a customer service and support programme. Everything should be done by the respective local team,” explains Mr Miles, who joined SSI Schaefer in 1980 to run their Gulf operations from Dubai, having previously spent four years working in the Eastern Province of Saudi Arabia.

The ability to produce and manage solutions in-house is the key purpose as this means customers can expect shorter response time to their enquiry. The objective being that, customers in the Asia Pacific will not need to wait weeks for SSI Schaefer’s team in Germany to provide them with solutions.

“While there are some changes to our setup, we continue to be a financially strong family-owned company. There will be no change to that. Although mergers and acquisitions are becoming more commonplace now in the industry, we do not subscribe to that strategy. Regardless of what people say, mergers and acquisitions are disruptive. People get nervous about their jobs. Some employees, whose company is being acquired, have approached us because they do not trust that they will still have a job the next morning. SSI Schaefer is 77 years old this year, and I trust that we will continue to be a family-owned company for decades more to come,” says Mr Miles of the German company.

Having faith & changing mindsets

While the industry veteran feels that the region has made plenty of progress over the past decades, it is still relatively slow when it comes to technology adoption.

“I think it boils down to the current Asian corporate mindset. Companies do not have the confidence to invest in an automated system and focus on a particular sector. Contracts with third-party logistics operators are generally only two to three years, which translates to choosing a very simple storage system to keep within budget cost,” mentions Mr Miles, who is urging a change in mindset in the industry.

But the trend has changed for business verticals. In the more developed markets, companies are focusing on specific market sectors, such as fashion goods, healthcare and pharmaceutical, to create a “distribution hub” for multi-users and investing in automation to suit that particular range of products. They will then use these benefits to win customers and ensure that the investment is depreciated over a longer period.

There is a shining light for certain markets. Mr Miles feels Singapore is succeeding in logistics due to valiant efforts by the Economic Development Board. Despite competition from Malaysia, and South Korea, he believes that Singapore will continue to be one of the world’s top logistics hubs. He also commented that unless Hong Kong finds new ways to boost its level of competitiveness, the city will continue on its dangerous downward spiral.

“Hong Kong’s competitive level has stagnated in my opinion. The city has a severe labour and space shortage. Although they were the first to develop multi-level ramp up warehouses some 30 years ago, they do not have the number of ramp up warehouses as we have now in Singapore. Singapore has at least 20 ramp up warehouses when they did not have any ten years ago, while I think Hong Kong has plateaued with four or five for the past decade,” explains Mr Miles.

Even when it comes to the total container throughput, PSA Singapore Terminals handled 30.62 million TEUs in 2015, while Hong Kong port only handled 20.1 million TEUs. However, there is a danger of pallet space oversupply in Singapore if it is not properly managed.

“There are so many pallet storage locations available, but there is a serious lack of simple picking systems installed. Check out most of the warehouses and chances are, there are only using pallet racks. What these guys need to do is pick a market sector and invest in it,” reiterates Mr Miles.

People will continue to drive supply chain

With the right software and IT, the warehouse of the future will look vastly different from the current typical setting. There will be no floor operators, manual pickers or forklift drivers. Instead, the only human workers in a futuristic warehouse are technicians.

“Actually, the future is already here. We have a warehouse in Australia where cases are stored within a racking system, then retrieved by robots, sequenced in stacking order on conveyors before being stacked on a pallet by another robot, shrink wrapped and transferred to dispatch loading docks. There are no workers in the warehouse, only technicians. Australia is the ideal market to test this out. The country’s logistics infrastructure is very advanced, and labour cost is high. This makes it easy for companies to achieve the return on investment for a fully-automated warehouse,” describes Mr Miles.

But this does not mean workers will be redundant in the industry but will be retrained with higher skill levels. Mr Miles, like many other senior executives, mentions the difficulty of finding the right talent. However, once the talent is secured, he believes that SSI Schaefer is an ideal place for anyone looking to stay for a long-term period. Having been with the company for over 30 years, he can testify to that.

“Some say that the reason people stay for years at a company is because they are either paid too much or the job is too easy. I do not know how true that is but I am still here because I am excited by the daily challenges the job brings,” shares Mr Miles.

It is a testament of his love for his job and SSI Schaefer’s leadership strategy that Mr Miles does not feel ready to retire. “My role at the moment is to handover to the new management team. However, I am not planning to retire. We have a CEO who has a habit of assigning hobbies to others, so I am looking forward to know what my next hobby is,” says Mr Miles, who currently counts golf as his hobby, which he continues to try to master.

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