Ronald Van Zitteren: Horizontal Collaboration Improving Control through Carpooling Cargo
Ronald Van Zitteren, Sr. Director, Head of Global Distribution & Logistics at UCB Pharma S.A., joined Cold Chain IQ Editor Andrea Charles, at the 11th Annual Cool Chain Logistics Europe 2012 event to share his insights on recent trends in improving the efficiency of temperature-controlled logistics and horizontal collaboration.
Cold Chain IQ: Please could you tell us a little bit about your current role and responsibilities.
R Van Zitteren: My role at UCB, which I took early this year only, is to take care of all global logistics and distribution topics, including primary and secondary distribution, road and sea, cold chain management, shipping qualification, validation and all import/export related regulatory topics and I’m working globally with a large team in Belgium and some remote teams around the world.
Cold Chain IQ: What challenges are you facing on a day-to-day and how is horizontal collaboration helping you to overcome them?
R Van Zitteren: One of the key challenges is the management of various partners that we’re working with. As a pharmaceutical or biopharmaceutical company that we are meantime we want to focus on our core competencies, especially in the functional area of logistics and distribution. We heavily rely on and partner with several service providers who will be carriers forwarding companies – air/sea alliance, cold chain, shipping solution providers, packaging providers and so on and, for sure, also 3PL organisations in our affiliate countries. It all requires quite a heavy management control. Now this is really challenging. We’re talking about tens of partners across various specialisms and in order to manage all of that in the best possible way we have to be able to really build very effective partnerships.
Now I think personally within our current company composition we have too many partners and we need to reduce to some crucial ones that really we’ll be deepening our partnerships with and really can go into collaborative mode to change for the better and to improve our control over all we do. The horizontal collaboration project that used to be engaged in with our colleagues from Baxter in Belgium is a very nice example of to what improvements such a collaboration can lead.
Stepping over the historical conservative mode in our industry, we have been able to partner up and be very transparent with Baxter and in building this unique case in the industry on carpooling for cargo concepts. The results so far that it has brought us are translated in enormous reductions in CO2 upward, we’re talking around 30%, double digit savings on our cost on the regular road transport into Eastern Europe and especially for UCB that’s through also an improvement of the service to our customers because we have an opportunity to partner with Baxter on increasing our cycle times and have a more often shipment opportunities into the East of Europe.
So altogether it’s been a very successful case so far and we’re just at the start of it. We’re just launching and now the interesting part comes where we’re going to expand with new partners building up our community and we expect exponential improvements coming out of that.
Cold Chain IQ: What are some of the key tenants of horizontal collaboration?
R Van Zitteren: A key word that comes back all the time is trust. Without trust among the community members this will not be possible. Another aspect is, of course, the quality aspects that play an important role in our industry, quality and compliance, I must say. Quality – certainly when it comes to temperature-controlled shipments, which is what we do with Baxter – so we have to really build bridges between the Q8 groups of the various companies and to try and rely on our internal policies and making sure that towards the service providers we have one force and one set of requirements. Then on the compliance end, of course, where basically competitors collaborate there’s always an anti-trust risk and we certainly have put a lot of time and effort in mitigating those risks through collaboration with our legal teams and making sure that there’s nothing that we’re doing that can harm the relationship or our image, or is in breach with the anti-trust regulations in Europe.
Last, but not least, the operational collaboration is very important and that’s where the orchestrator, the advisor plays the pivotal role. They are the facilitator, they are the service provider when it comes to the synchronisation of our shipments and they’re also providing you with service of the whole thread billing and KPI reported to West Tudor especially setup portal. So altogether we are very happy with this collaboration and we’re looking forward to expanding it in the near future.
Cold Chain IQ: From a Pharma perspective what would be your do’s and don’ts for entering into a horizontal collaboration agreement?
R Van Zitteren: From a company perspective we’re searching for partners that are people that talk the same language. That means per definition biopharmaceutical companies. It also means per definition companies that work in different diseases than UCB is working. UCB is in central nervous system and immunology related diseases, while Baxter is in the renal area. We also found out it’s important that in this concept it’s crucial to find a partner with a considerable large volume into the regions that you want to ship. So that is going forward also one of the learnings we had.
Furthermore we have frequent open conversations ongoing, we have formal meetings looking into the KPIs and results, but we also have more business development focus meetings to talk about potential new routes and flows that you want to set up to look into how we can best expand our community, so which future partners we will target at and last, but not least, also with service providers who fit best with that approach. That’s on the do’s. On the don’ts, I think the most important is not to set too high expectations and not only to focus on financial savings. There’s much more to gain than just a better cost of serve rate. The service aspect and the sustainability aspects are as equally important to us as the financial aspects.
Cold Chain IQ: What trends are you seeing with regards to improving the efficiency of temperature-controlled logistics?
R Van Zitteren:Having been around for the last eight/nine years in this industry and looking into the cold chain management things are not developing quickly. A clear trend is multi-model transport, so road combined with rail, which we’re also applying our horizontal collaboration concept. Another trend is an increase of sea freight to Reefer containers. I also picked up during this conference the desire to have quality teams working more together on auditing partners like 3PLs carriers and so on. I think that’s a very good initiative and I would really like to support that from a UCB perspective also, if we can. Another trend is that it seems that we are at the point where people now realise that horizontal or vertical collaboration is really key to go forward now and really make further improvements, so going to the more biotech era the percentage of biotech and the total percentage of sales in the biotech/pharma industry will increase, the volumes get smaller, the values go up – so from a volume perspective we get only more empty trucks instead of fuller trucks, so there’s collaboration needed. That’s my key message here.
Pharma IQ: Is this your first time at Cool Chain Logistics Europe?
R Van Zitteren: No, this is, I believe, my third time. I’ve been to Brussels, Amsterdam in the past, but it’s now two years ago, so I’m happy to be here in Basel – Switzerland is a perfect location, although I would prefer rather Zurich. It’s great to see that compared to a few years ago, I think the attendance has grown both on the delegate side as well as on the providers of solutions side, so I’m very happy that this event is so alive and, honestly, this is for me the best cold chain related event in the industry and I advise everybody to take part in it.
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